Cryptocurrency prices drowned on Tuesday, which expands a downtrend that began in November last year.
Bitcoin (BTC) fell below the significant support level of $ 89,220, reaching the $ 86,000 intraday low.
Altcoins remained even worse, fell to $ 0.01683 with Jasmy Coin (Jasmy), its lowest level since 5 November, and 72% below its 2024 high levels. Peppe (Pepe) and Dogocine (Dogge) also dropped by more than 8%, while the joint market capitalization of all meme coins tracked by Koingco fell below $ 60 billion.
Three major catalysts behind Crypto Crash
There are three potential catalysts for the ongoing crypto crash.
First, the market negatively responded to former President Donald Trump’s commitment to putting tariffs on Canadian and Mexican items starting in March. These tariffs were postponed for a month to allow drug policies and conversations on immigration.
25% tariff on US imports will lead to high inflation and slow economic development, which will put pressure on the Federal Reserve. Fed has already indicated that it will only cut interest rates when inflation becomes close to its 2% target. However, recent economic data shows that both the headline and core inflation figures are moving beyond this target.
Second, the prices of bitcoin and other crypto are decreasing as American shares were mixed. The NASDAQ 100 index was about 0.55% less open while the S&P 500 index was about flat. Dow was up 0.36%. There is a possibility of weakness in the technical sector due to the market expectation of NVIDIA’s fourth quarter income, which is expected to provide more information in the artificial intelligence sector.
Bitcoin price shine sales signal
Third, the prices of bitcoin and other crypto, including Peppe, Dogin and Jasmi, fell further after BTC flashs a selling signal on the daily chart. The daily chart suggests that Bitcoin created a double-top pattern at $ 108,438 in December and January.
It is now broken at $ 89,136 below the neckline, confirming a recession approach. It has also gone below the 50-day and 100-day moving average. A continuous cell-off bitcoin could push the next major support level to $ 73,725, the most swing in March last year, a decline of 18% from current levels. Such a step will probably lead to further decline in AltCoin market.
Inverted, there is still a chance that the accident is a false breakdown, which occurred on January 13, which eventually led to a strong reversal.
