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The bitcoin price has dropped towards $50,000 per bitcoin, with the combined crypto market plunging under the $2 trillion level as fears swirl the U.S. dollar is on “the verge of a total collapse.”
Now, after Coinbase’s chief executive last week revealed an AI game-changer, bitcoin and crypto market sentiment has swung to “extreme fear” as the market digests the latest U.S. jobs data that missed expectations, driving the bitcoin price below a key resistance level.
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The bitcoin price has dropped below a key resistance level as the crypto market crashes under $2 … [+]
“A key technical support level for the bitcoin price remains just above $54,000, but slippage in the event of a volatility spike could see the price briefly drop below $53,000, Alex Kuptsikevich, FxPro senior market analyst, said in emailed comments.
Earlier this week, legendary bitcoin trader Arthur Hayes and analysts with Bitfinex predicted the bitcoin price could fall much further in the short term.
The Crypto Fear & Greed Index, a measure of crypto market sentiment, has sunk to a one-month low of 22, a sign of “extreme fear” and a level last seen during the August market meltdown.
The bitcoin price fell to just over $52,000 before rebounding back above $53,000. The rest of the crypto top ten has crashed back along side the bitcoin price, with ethereum, BNB, solana, XRP and dogecoin each losing between 5% and 10% over the last 24 hours.
The bitcoin price crash comes as U.S. jobs data showed the economy added 142,000 new jobs in August, short on economists forecasts of around 161,000.
The slowing jobs market has fueled fears the Federal Reserve has waited too long to cut interest rates, with the economy at risk of falling into recession.
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The bitcoin price has crashed back from its all-time high of over $70,000 per bitcoin set in March, … [+]
However, others think the looming Fed interest rate cut—widely expected to kick off a rate-cutting cycle—could be a bullish catalyst for the bitcoin price and wider crypto market.
“The recent U.S. labor market results acted as a moment of truth for risk-on assets like bitcoin, as the labor market is considered the main sector that may influence the Fed’s decision to cut rates this month,” Leena ElDeeb, research analyst at 21Shares, said in emailed comments.
“With a slightly improving unemployment rate, investors traded positively, pricing in a looser monetary policy on September 18. A rate cut bodes well for risk-on assets which have historically enjoyed the expansion of the investor appetite as borrowing costs decrease. If a hard economic landing is avoided, bitcoin and the broader market may see appreciation in the fourth quarter, driven by these liquidity dynamics.”