Bitcoin Seeks Crucial Support Amid Macro-Economic 'Bloodbath'

The recent downturn in the crypto market can be attributed to deteriorating macroeconomic conditions in the United States. Inflation has persisted, with the Personal Consumption Expenditures (PCE) index reaching 4.1% year-over-year, a level not seen since 2023.

This data has led to a shift in market expectations, with derivatives pricing in up to a 34% probability of another rate hike. This reduction in risk appetite and decrease in global liquidity have directly impacted Bitcoin, one of the main historical drivers of its price action.

The decline in Bitcoin's price has been exacerbated by institutional outflows and a sharp deleveraging process in derivatives markets. Liquidations across leveraged positions exceeded $1.0 to $1.48 billion, with a heavy concentration in long positions.