Crypto Market Faces Severe Correction as Bitcoin Drops to $25,000 Mark

Summary:
Bitcoin's current strong support level is around $25,000, but a drop below this may send prices tumbling to $23,500 and below. The bad news is that it has already broken this support. Altcoins have also suffered, with Ethereum (ETH) dropping by 5.5% and other top 10 cryptocurrencies losing 6%.

Bitcoin and the rest of the crypto market have experienced a severe correction in the hours after Jerome Powell said that interest rates will remain steady. After losing almost 3.5% in value over the last 24 hours, Bitcoin (BTC) is now trading at the $25,000 mark.

Similarly, the whole crypto market has lost almost $40 billion in value and is about to drop below the $1 trillion threshold. Bitcoin’s (BTC) current strong support level is around $25,000; a drop below this may send prices tumbling to $23,500 and below. The bad news is that it has broken this support and now trading at $24, 956.

BTC Sits on Thin Ice

Prominent Crypto expert Ali Martinez said, 

“Bitcoin sits on thing ice! Notice the most important support zone is between $22,785 and $23,595 where 1.34 million wallets hold 450,000 $BTC. On the flip side, #BTC faces stiff resistance between $26,000 and $28,250 where 5.18 million wallets bought 2.1 million BTC”.

So far in 2023, we have observed that there is a strong link between Bitcoin and US stocks. Even though US Fed Chair Powell indicated that two more rate rises might be coming this year, shares in the US closed the day on Tuesday unchanged.

SEC Crackdown Effect

Given that the cryptocurrency market is already struggling with liquidity issues due to the SEC cases against Binance and Coinbase, the Bitcoin and cryptocurrency markets have responded swiftly to this. In light of recent events, some of the crypto exchange’s financial partners have begun reevaluating their commitment to the business.

Altcoins Suffer More

The correction seems to be more severe in the altcoin market than it is for Bitcoin. Ethereum (ETH), the second-largest cryptocurrency in the world, has dropped by more than 5.5% and is now trading below the $1,650 mark.

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Over 6% losses have been incurred by other top 10 cryptocurrencies such as BNB, XRP, Cardano ADA, and Polygon MATIC. It seems that the bears have gained control of the markets over the bulls, and the extent to which the market may correct from here is uncertain.