The crypto market has undergone a substantial retracement, with Bitcoin’s price witnessing a nearly 10% decline since its peak on December 8th. This downturn has sent shockwaves across the crypto space, affecting lower-cap altcoins even more significantly. Bitcoin, the leading cryptocurrency, recorded a notable drop, prompting a reassessment of the recent bullish sentiment.
The retracement is not limited to Bitcoin alone, as lower-cap altcoins are reporting particularly steep falls. Investors in these alternative cryptocurrencies are witnessing substantial losses, prompting some to reevaluate their positions in the market.
As the market grapples with the recent downturn, there is a notable split in sentiment. On one hand, advocates of the “buy the dip” strategy are encouraging investors to take advantage of the lower prices, seeing it as an opportunity for strategic entry or accumulation of assets.
On the other hand, a growing number of speculators are expressing concerns about the possibility of a looming bear market. The recent retracement has fueled discussions about the sustainability of the bullish trend that has dominated the crypto space in recent months.
Bitcoin: Inflation Indicators This Week
Industry experts and analysts are divided on the root causes of the retracement and its potential long-term effects. Some attribute the decline to profit-taking after the recent price surge, while others point to external factors such as regulatory developments and global economic uncertainties. Despite the market drop, some individuals continue to assert a bullish outlook on BTC. A trader remarked,
Bitcoin has been on a prolonged bull market cycle since 2019. The pattern of Bull market cycle is identified in BTC, and it is now in the stage of “Renewed Optimism”, the first stage of the Blow-off phase. The next stage is “FOMO” when it reaches over $100,000. In the “Euphoria” stage, BTC could reach over $400,000. We are still early We are still in the early stages.
The market is eagerly awaiting the release of the November Consumer Price Index [CPI] inflation data scheduled for December 12. Simultaneously, the Federal Open Market Committee [FOMC] is slated to convene on December 12 and 13. These two events hold significance for Bitcoin’s price. The CPI inflation data typically influences the FOMC’s decision on whether to adjust interest rates in its efforts to combat inflation. A dovish stance, viewed as positive for markets, including Bitcoin, contrasts with a hawkish one, which tends to have a negative impact.