Analysis Company Said "The Situation is Not That Bad for Bitcoin Despite the Sharp Drop", Explained Two Factors Signaling Rise!

Bitcoin (BTC) and altcoins are trying to cope with sharp declines, investors are suffering significant losses.

The losses of investors in leveraged transactions reach billions of dollars, with increasing fears of customs tariff wars, economic uncertainty, decreasing likelihood of the Fed cutting interest rates, and growing concerns about a possible recession behind the decline.

These factors reduce market risk appetite, while analysts evaluate the recent decline and the possibility of a rise.

Nick Ruck, Director of LVRG Research, speaking to Coindesk, said that investors are adopting a risk-averse approach due to the decreasing probability of FED rate cuts and expectations that the February CPI report will be similar to January's.

Ruck, who emphasizes the need for the economic outlook to clarify and the probability of interest rate cuts to increase for a rise, said, "Investors can set aside and balance the risk in their portfolios until the economic situation in the US becomes clearer and the need for interest rate cuts strengthens even further; this could happen towards the end of this year."

Weakening US dollar is Positive for Bitcoin!

Singapore-based crypto trading firm QCP Capital said in its latest analysis that despite the recent drop in BTC(BTC) in Bitcoin, not all signals point to a downward trend.

Analysts pointing out signs of recovery despite BTC falling below 80,000 dollars, said that the weakening of the US dollar and a drop of around 60 basis points in the 10-year US Treasury yields were two positive catalysts for US stocks and cryptocurrency markets.

On March 10, the S&P 500 and Nasdaq indices fell by 2.7% and 3.8% respectively. The Magnificent 7 lost more than 830 billion dollars, marking the biggest single-day loss in history for these names.

Moreover, trading volumes of US stock put options have also soared to their highest level since 2020, indicating that the downward trend is currently in full swing.

In particular, recent comments by US President Donald Trump on a possible economic downturn have worsened market sensitivity to risky assets and caused BTC to fall below 80,000 dollars.

However, despite the turmoil in the market, not all signals are pointing towards a downward trend. This latest downward wave has pushed 10-year Treasury yields down by approximately 60 basis points and weakened the US dollar. These are historically positive factors for USD-denominated risk assets such as US stocks and cryptocurrencies.