A short-term rebound seems to be moving away in the world of cryptocurrencies that do not find catalysts to approach key symbolic values. Bitcoin remains below $60,000 at $59,098 (down 2.7% in the last 24 hours) while Ethereum drops 3.7% to $2,800.
The rest of the altcoins are also trading in the negative over the last 24 hours. If we count the last 7 days, the digital assets that lost the most are:
- Solana: -22.3%
- Near Protocol: -22%
- Avalanche: -18.2%
- Dogecoin: -17.3%
- Shiba Inu: -16.6%.
Bitcoin and Ethereum fell more than 10% in the last 7 days.
The truth is that these are not positive days for digital assets. Since bitcoin touched $70,000 after the announcements of the Republican Party to create a strategic reserve, The cryptocurrency has lost its key levels: What has happened to cause these falls?
The fall of cryptocurrencies: the 3 reasons
1. The escalation in the Middle East
In recent days, Hamas leader Ismail Haniyah was killed in a missile attack in his residence in Tehran, Iran. The terrorist group and Iran have accused Israel of being behind this move, and according to a report by The New York Times, Iran’s supreme leader Ayatollah Ali Khamenei has ordered a direct attack on Israel.
2. Macroeconomic data in the US
LWeekly unemployment data hit its highest level in almost a yearwhile ISM and S&P PMIs They showed that The manufacturing sector has contracted for the fourth consecutive month and at a faster pace than expected. he market. While analysts assume the Federal Reserve will cut interest rates in September following the latest inflation data, some are wondering If it goes too late in its process of transition to a less restrictive monetary policywhich should be positive for cryptoassets.
“The lower inflation we have seen in the last two months means that The Federal Reserve’s main concern is no longer inflation“n,” said Roger Hallam, Vanguard’s global head of rates. In his view, the focus of Chairman Powell and his team is now on the central bank’s dual mandate of keeping inflation low and employment stable. The longer interest rates remain tight, the more the downside risks to the broader economy will increase.
3. Expectations for the US presidential election
Not too long ago, Donald Trumpthe favorite candidate of the cryptocurrency market, started with a huge advantage over Joe Bidenbut the scenario seems to have changed dramatically after the resignation of the current president in favor of Kamala HarrisThe current vice president has narrowed the gap between Democrats and Republicans in the polls: according to data from Polymarket, the Republicans’ chances of victory have fallen from 70% to 55% in the two weeks that Harris has emerged as a possible Democratic candidate.
In this sense, QCP Capital points out that the candidates’ positions play a role key role for cryptocurrencies in the future, with markets potentially moving in a range until the next catalyst. “In the longer term, discussions between US presidential candidates and senators about a sovereign reserve of bitcoin and the possibility of other nations following suit could fundamentally alter the cryptocurrency landscape,” they explained in a recent report.
Source: Ambito
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