Crypto has turned red again as Bitcoin tests the $80,000 area and leveraged positions are being wiped out at a rapid pace. Roughly $450 million in crypto positions were liquidated in the past
Crypto has turned red again as Bitcoin tests the $80,000 area and leveraged positions are being wiped out at a rapid pace.
Roughly $450 million in crypto positions were liquidated in the past 60 minutes, adding forced selling to an already weak market. U.S. spot Bitcoin ETFs also recorded a net outflow of $484.9 million on October 7, showing that institutional flows have turned negative at the same time macro conditions are worsening.
The biggest pressure is coming from interest rates.
The U.S. 10-year Treasury yield has moved to around 5.36%, and recent Fed minutes indicated that most officials still see another rate increase as likely by year-end.
That is a difficult setup for crypto.
Higher yields increase the opportunity cost of holding assets such as Bitcoin and Ethereum that do not generate cash yield. They also make leverage more expensive and tighten overall financial conditions.
Oil is adding another problem.
Brent crude has moved above $100 per barrel amid concerns around Iran-related supply and tanker disruptions. Higher energy prices can keep inflation elevated, which makes investors less confident that the Fed will be able to ease policy soon.
That combination is negative for crypto and other risk assets.
Rising yields are also supporting the U.S. dollar. A stronger dollar typically puts additional pressure on dollar-priced assets and reduces global appetite for speculative investments.
Read also: Crypto Crash Warning: How Low Can Bitcoin and Ethereum Prices Go?
Bitcoin is now testing one of the most important psychological levels on the chart.
The $80,000 area is the first major support to watch. If buyers fail to defend it, the next zone could sit around $77,000 to $78,000, followed by the mid-$70,000 region.
For bulls, the first task is simply stabilizing above $80,000.
A recovery back above $82,000 to $83,000 would reduce some of the immediate pressure, but the broader market will likely remain sensitive to bond yields, oil prices, and Fed expectations.
The key problem is that several bearish forces are hitting crypto at the same time.
ETF outflows are weakening demand, liquidations are accelerating the decline, Treasury yields are rising, oil is adding inflation pressure, and the dollar is strengthening.
Until at least one of those factors improves, Bitcoin may continue struggling to build a meaningful recovery.
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The post Here’s Why Crypto Market Is Crashing as Bitcoin Tests $80K appeared first on CaptainAltcoin.
