Why is Bitcoin below $ 50,000? The analyst responds

Bitcoin has been hovering below $ 50,000 over the past 75 days, and the current trend has somewhat exhausted traders; But what has made the market unable to cross this level?

To Report Youtoodi Will Clemente, chief analyst at Blockware, said the price of bitcoin has been fluctuating in a bullish channel for the past two months. This indicates that the market for this digital currency is still unsure of the trend it should follow and is waiting for more signs.

As you can see in the chart below, the channel through which Bitcoin moves is formed at the beginning of February. At the time, the digital currency was priced at approximately $ 45,000 and rose to $ 37,000 after revision. Then the market followed another upward trend.

In the next uptrend, buyers still could not break the resistance of the Bitcoin channel, and the price of this digital currency fell again to $ 38,623. Traders’ failed attempts to break the bitcoin resistance may indicate low purchasing power for micro-investors as well as corporate investors.

Why is Bitcoin below $ 50,000?

The two main factors in the current market situation are the fear and distrust of traders. Large or institutional investors do not bring any new money into the market because there is no clear signal in the market and traders want to minimize their risk in the digital currency market and traditional financial markets. As we saw in the February fluctuations, the existence of new liquidity is essential for the rise of bitcoin.

In addition, statistics on bitcoin holdings in exchanges show that investors are constantly withdrawing their funds from centralized exchanges and depositing them in private wallets. The high outflow rates of exchange offices show that the liquidity of the digital currency market is slowly declining.

At the time of writing, the world’s first digital currency is trading at $ 38,770. The most notable event this week will be the rise in US bank interest rates that financial markets have been waiting for since the beginning of 2022.