Bitcoin’s price continues to struggle beneath the critical $85,000 level as market sentiment remains shaky amidst rising sell-off pressures.
Coin Days Destroyed metrics indicate a troubling trend, with short-term holders liquidating nearly 10,000 BTC daily amid ongoing uncertainty.
Currently trading at $83,184, Bitcoin faces a potential downward movement if it fails to reclaim crucial resistance levels, particularly with $82,761 acting as a pivotal support.
Persistent selling pressure, especially from recent market entrants seeking to liquidate their holdings, highlights the challenges Bitcoin faces.
This situation is exacerbated by heightened volatility, reduced demand, and tighter liquidity, all of which collectively hinder substantial accumulation. Without renewed buying interest, Bitcoin confronts a significant risk of further price declines.
The absence of noteworthy accumulation contributes to a pervasive sense of fear within the digital asset community, further fueled by a lack of definitive bullish signals. As seller pressure continues to mount, Bitcoin remains vulnerable to damaging price dips.
Trade war concerns weigh in
Despite lower-than-expected U.S. inflation data, Bitcoin struggled to maintain gains as trade war concerns weighed on sentiment.
- According to the latest economic data released on March 12, February’s Consumer Price Index (CPI) rose 2.8%, below the forecast of 2.9%. Core CPI, excluding food and energy, dropped to 3.1%, slightly better than the expected 3.2%.
- Markets responded by increasing bets on Federal Reserve rate cuts. Traders now price in a 31.4% chance of a cut in May, up from just 9% last month. The probability of three cuts by year-end jumped to 32.5%, while expectations for four cuts surged from 1% to 21%.
In response to U.S. steel and aluminum tariffs, Canada recently imposed $21 billion in tariffs on U.S. exports. The European Union followed suit, imposing additional tariffs on American goods valued at $28 billion. There is growing concern that rising trade disputes may increase inflationary pressures and complicate the Federal Reserve’s decision-making.
What you should know
According to The Kobeissi Letter, the U.S. faces a $9.2 trillion debt refinancing challenge in 2025.
- Without lower interest rates, borrowing costs could rise sharply, further straining the national debt, which now exceeds $36 trillion. Market uncertainty remains high, with investors closely watching developments in both monetary policy and global trade.
- On-chain data indicates that cryptocurrency traders are losing confidence. Crypto-wide trading activity has been declining since its peak in late February, according to Santiment.
- Over the last two weeks, market capitalization losses have left traders hesitant, with signs of exhaustion and capitulation creeping in. Even Bitcoin’s CPI-driven bounce failed to spark any real uptick in trading activity.
This type of volume decline typically indicates weak market momentum amidst small price recoveries. Gains can swiftly wane in the absence of strong buying interest, leaving prices open to further declines. Retail and institutional traders appear to be in a holding pattern, waiting for the other to move. Until volume picks up meaningfully, caution is likely to dominate.
