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Why is bitcoin falling?
Bitcoin, which has risen with the news that Elon Musk has bought all of my Twitter, again fell below $ 40 thousand with the opening of the US stock markets. While the US dollar index continues to hover above DXY 102, the largest cryptocurrency is trading at around $38,900.
Bitcoin, which rose again with the news of Elon Musk and Twitter yesterday, showed its correlation with the US stock markets in the short term. Bitcoin also reacted negatively to the opening of the US stock markets with decreases and again fell below $ 40 thousand.
At the time the news was written, Bitcoin was traded for around $ 38 thousand 900, while Dogecoin, the biggest winner of yesterday, also experienced a decrease of 5 percent. The phenomenon coin went above $0.16 yesterday but is currently trying to hold just above $0.15.
The Fall in The US Stock Markets Affected Again
The US stock markets, which have experienced sharp decreases in recent days amid the news that the Fed will once again adopt a policy of increasing interest rates, opened today with a decrease. Dow Jones opened the market with 0.42%, S&P 500 with 0.64%, and Nasdaq, the technology exchange, which is stated to be the most correlated with Bitcoin, opened the market with a 0.67% decrease.
Is The Fed Pricing?
As it is known, the US Federal Reserve (Fed) will hold one of its historic meetings next week, and the decision to increase interest rates will be announced on May 4, after two-day talks on May 3-4. While experts expect an increase of 50 basis points, 75 basis points are among the options.
The higher-than-expected rate hike may further harden the decline in Bitcoin and cryptocurrencies. However, if the increase remains at the expected level, it may also bring a price increase. Because the “pioneering pricing” of this meeting has already been seen for a while.
On the other hand, the fact that the number of cases in the coronavirus epidemic in China has reached a serious level and both the number of ships in Chinese ports and the wait for these ships to unload their cargo are also seriously affecting the supply chains. This may lead to more difficult economic conditions.