Why Bitcoin is Down Today? Analyst Warns of Bearish Pressure on BTC Price

Popular crypto analyst Michaël Van de Poppe has issued a warning to investors amidst Bitcoin’s recent downturn, signaling potential downward pressure on the cryptocurrency. Bitcoin (BTC) saw a significant 6% drop on Tuesday, falling to about $63,400, marking its largest one-day decline in two weeks.

This drop comes amid a broader uptick in cryptocurrencies, but Van de Poppe has pointed out several factors contributing to Bitcoin’s current downward trend.

Here’s a deep dive into his reasoning.

Understanding the Plunge

Upcoming FOMC Meeting

A key factor highlighted by van de Poppe is the upcoming Federal Open Market Committee (FOMC) meeting scheduled for March 20, 2024, expected to heavily influence the crypto market’s direction.

During the last FOMC meeting in January 2024, the Federal Reserve chose to keep interest rates steady at 5.25%-5.50%. This indicates the Fed’s ongoing pause in raising rates initiated in March 2022 to tackle inflation.

Moreover, the Fed has signaled it will keep rates unchanged until there are clear signs of inflation dropping below the 2% target. As a result, many analysts and investors anticipate the central bank will maintain its current rate stance on March 20, 2024.

Changes in Japan’s Central Bank Policy

Another significant development is Japan’s central bank’s recent decision to end its negative interest rate policy after eight years to stimulate lending and demand. The Bank of Japan (BOJ) raised its short-term policy rate from -0.1% to a range of zero to 0.1%.

However, some analysts caution that the BOJ may proceed cautiously with further rate hikes due to the slow economic recovery.

Transition of Grayscale’s Bitcoin Fund

A notable event in the cryptocurrency realm occurred when Grayscale transformed its fund into a Bitcoin Exchange-Traded Fund (ETF) on January 10, following the SEC’s approval of a spot Bitcoin ETF. Subsequently, Grayscale began moving its BTC holdings to Coinbase for selling.

Previously structured as a closed-end fund, Grayscale’s bitcoin fund required investors to hold shares for at least six months. With the introduction of ETFs, investors can now quickly liquidate their holdings and realize profits, a trend that seems to be underway once again.

Also Read: Ethereum ETF Approval by May? Standard Chartered Predicts $14,000 by 2025

Potential Opportunities for Altcoins

Despite Bitcoin’s downturn, Van de Poppe suggests a potential upside for altcoins. A decrease in Bitcoin’s dominance could make altcoins more appealing to investors looking to diversify and grow within the crypto market.

Read More: Reddit-Based Altcoins That Can Yield 100% Profits This Week!

Amid these market shifts, Van de Poppe’s research continues to provide valuable insights for investors. Are you taking his advice as a guiding light?