The crypto market faced turbulence on Sunday, with Bitcoin and Ethereum struggling amid concerns about inflation and the U.S. government’s potential sale of seized Bitcoin. Traders are bracing for volatility, keeping a close eye on key resistance levels.

Key Takeaways  

1. Bitcoin Drops Below $63K: Bitcoin dipped to $62,045 before recovering slightly, with Ethereum also facing resistance near $2,500.
2. US Bitcoin Sale Sparks Fear: The U.S. government may liquidate 69,370 BTC seized from Silk Road, adding pressure to the market.
3. Analysts Expect a Breakout: Experts predict Bitcoin could hit $65K after a brief consolidation, though volatility remains high.  

Market Slips on Inflation and Liquidation Worries  

Major cryptos slid Sunday, driven by inflation concerns and the potential sale of seized Bitcoin by the U.S. government, keeping traders cautious.  

Bitcoin Drops Under $63K

Bitcoin dipped below $63K, briefly hitting $62,045 before regaining some ground later. Ethereum struggled near $2,400, unable to break the $2,500 mark amid selling pressure.  

Ethereum's Yearly Gains Shrink  

Ethereum’s 2024 gains have narrowed to 7.77%, reflecting a steady decline since hitting nearly $3,900 in May. Bulls faced resistance, adding to the market’s uncertainty.

Read More: $1.3 Billion in Ethereum (ETH) From PlusToken Ponzi Scheme: Potential Market Impact

US BTC Sale Concerns Add Pressure  

The U.S. Supreme Court’s refusal to block the sale of Bitcoin seized from Silk Road raised fears. With 69,370 BTC in government control, traders anticipate increased volatility.  

$100M Liquidated in 24 Hours  

Crypto markets saw $100M in liquidations over the past day. Bitcoin’s Open Interest dropped 0.38%, and bearish traders increased, pulling the long/short ratio further down.  

Sentiment Stays Neutral  

Despite the turbulence, the Crypto Fear & Greed Index remained in the neutral zone. The market cap slid 0.89%, standing at $2.19 trillion amid cautious trading.  

Stock Futures Drift as Rate Cut Expected  

Dow futures dipped 0.03%, while S&P 500 and Nasdaq 100 futures saw slight losses. Projections show a 90% chance of a 0.25% rate cut by the Fed next month.

Read More: Geopolitical Tensions and US Elections Favor Bitcoin’s Debasement Trade: JPMorgan

Analysts Expect Bitcoin Recovery  

Brief Consolidation Before Breakout  

Michaël van de Poppe expects Bitcoin to consolidate for 1-2 more days. He suggests that testing $64K could unlock the long-awaited breakout.  

Key Levels to Watch  

CrypNuevo flagged a crucial liquidation cluster between $63.5K and $65K. He warns of possible shakeouts early in the week, but prices are expected to reach that zone soon.  

Prepare for Market Swings  

Analyst Martinez advises caution as large price swings may occur amid ongoing uncertainty. Traders are keeping an eye on key levels to gauge the next move.

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FAQ

Q1: Why did Bitcoin and Ethereum prices drop?

A1: Prices fell due to inflation concerns and the U.S. government’s potential sale of seized Bitcoin.

Q2: Will Bitcoin recover soon?

A2: Analysts expect a brief consolidation followed by a potential breakout toward $65K.

Q3: How are traders reacting to market volatility?

A3: Many are placing bearish bets, leading to increased liquidations and cautious sentiment.  

Conclusion  

The crypto market stays tense with inflation worries and the potential sale of seized Bitcoin adding pressure. However, analysts see a chance for Bitcoin to reach $65K after some consolidation. Traders are closely watching key levels, keeping the market on edge.  

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