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What Traders Are Saying About Bitcoin’s Biggest Monthly Loss In 11 Years

Poor macroeconomic sentiment, inflation concerns, and systemic risks from the crypto market have pushed cryptocurrencies below 2017 highs.

Bitcoin fell nearly 38% in June to record its second-largest monthly loss since its launch in 2009. It traded over $31,000 on June 1 and dropped to as low as $17,700. dollars in the middle of the month, before recovering and ending the month at $19,209, according to CoinGecko Data.

The monthly drop is second only to bitcoin’s 38.6% drop in August 2011 and pushed the price below its 2017 high.

The losses in June came amid a decline in macroeconomic sentiment, inflation concerns, and systemic risks from within the crypto ecosystem, such as the insolvency of the cryptocurrency. Cryptocurrency lender C Network and the boom of crypto hedge fund Three Arrows Capital.

“These losses were caused by many factors,” said Ali Kassab, President of crypto investment firm Centurion & Co.

“From the collapse of Terra to the liquidation of Three Arrows Capital and endless layoffs, bad trends in the crypto industry have weighed on the bitcoin price,” added Kassab, noting that he expects the institutional investment “poured into assets” and generated “better price performance” in July.

Prices to ‘range’

Others like Chris Terry of lending platform SmartFi say they expect bitcoin to trade in a rather narrow range in the short term. “The feeling of the trading desk is that if bitcoin stays in the $18,000 to $20,000 range, it will take a long time and we could be in this range for a few weeks,” he said. speak.

“Everybody feels that bitcoin needs to wash up and get rid of all short and reset positions, probably going to be the full 80% retracement, a typical thing in the market, going down in the range $12,000 to $13,000,” added Terry.

At press time, the largest cryptocurrency is changing hands around $19,200, up 0.3% over the past 24 hours.

Central banks renewed investors’ concerns about rate hikes earlier this week at the European Central Bank’s annual forum. Federal Reserve Chairman Jerome Powell reiterated the central bank’s commitment to raising interest rates to curb inflation.

Speaking at the ECB meeting, Powell said he was more concerned about the challenge posed by inflation than the possibility that higher interest rates could push the US economy into recession.
Mr. Powell said the Fed must raise rates quickly, Reuters reported, adding that gradual increases could make consumers feel that higher commodity prices will persist. About a week ago, his comments suggested that rate hikes could ease before next year.

Searching for the bottom

Such prospects have led some to suggest that bitcoin has yet to bottom out, although many are optimistic that it will eventually recover and rally to new highs.

“I don’t think BTC has bottomed out, but I am sure the bull market will return,” said Jimmy Zhao, founder of crypto exchange ZBX. “I recommend buying bitcoin when the price is low and holding on to it, because in the next bull run its price will at least hit $100,000.”

Buy bitcoin cheaply and hold until the next cycle is a sentiment shared by others in the industry.

“Indicators are in a state of extreme fear, [with] some long-term capital holders and entrepreneurs,” said Anton Gulin, chief business officer at crypto exchange AAX. default business. “However, it is not the first or last bear cycle and those with a better long-term operational plan see this as an opportunity to build and prepare for the next bull run.

“When someone sells, it’s always a buyer. I expect the liquidity shift to continue and a slew of mergers and acquisitions in the coming months,” Gulin added.