The crypto market is going down today! Bitcoin & Ethereum prices have plunged below $29,000 and $2000, respectively. The market outcomes come in line with the aftermath of the most awaited Ethereum Shapella upgrade. The total market capitalization has dropped by nearly 5% and is speculated to drop below $1.2 trillion if the bearish trend continues.
But what caused the crypto markets to drop?
Amid the times when well-known analysts believed that the BTC price was on the verge of triggering a notable bull run, the crypto markets flipped and plunged hard following regulatory concerns and displaying signs of weakness within the markets. While Bitcoin was on its way to reaching levels beyond $30,500, the current plunge caused the price to trade at a 7-day low.
The bearish outcome kicked in ever since SEC Chair, Gary Gensler refused to answer whether Ethereum was a commodity or not. He appeared before the United States House Financial Services Committee for an oversight hearing. Despite repeated requests, Gensler refused to answer, which spooked the investors.
Secondly, the FED Reserve Chair issued a statement saying that he is committed to reducing inflation by hiking interest rates. Although the markets continue to remain fearful of the recent bank crisis, the FED chair appears to be poised to bring down inflation to 2%.
“We remain committed to bring inflation back down to our 2% goal and keep longer-term inflation expectations well anchored. Reducing inflation is likely to require a period of below-trend growth and some softening of labor market conditions. Restoring price stability is essential to set the stage for achieving maximum employment and stable prices over the longer run,”
What’s Next with the Bitcoin Price?
Although the market conditions are currently in favor of the bears while the bulls remain passive, the Bitcoin price appears to be bullish from a larger perspective. The BTC parabolic play is still in action, and the current correction appears to be important for the next bullish rally.
Therefore, a popular analyst, Captain Faibik, believes that the path to $38,000 continues to be in play.
Collectively, Bitcoin prices continue to remain under the bullish influence as long as they sustain above the crucial support levels. Moreover, the fractals indicate a massive retest of the previous highs could still be valid as the token carries a hidden bullish divergence that may be triggered after achieving certain levels.