As of the writing of this article, the price of Bitcoin (BTC) 
$70,765 has dropped below $71,000. What is happening in the cryptocurrency market? While there are no significant developments specifically regarding cryptocurrencies, fluctuations in macroeconomic markets are noteworthy. The inability to surpass the all-time high (ATH) level has also contributed to this situation.
Reasons for Bitcoin’s Decline
Due to the upcoming U.S. elections and the narrative surrounding “Uptober,” historical data has shown that the BTC price was supported as it approached the ATH threshold. However, the level of $73,777 has not been surpassed. Even more concerning is Trump’s chance of winning; despite the upcoming elections, he is still trailing Harris in polls.
Impact of Economic Indicators
If the likelihood of Trump winning the November elections is weak, we should witness a drop that the market would price in beforehand. Another significant reason for the decline is the drop in the S&P 500 index. The decline in the stock market after the opening of U.S. markets has negatively impacted Bitcoin prices due to their positive correlation.
The negativity in the macroeconomic front is attributed to the PCE data and unemployment claims. The decline in PCE has stopped, and unemployment claims are not as high as expected. This situation adversely affects expectations regarding the pace of interest rate cuts.
If the Fed signals a pause in interest rates (with a decision due in seven days), and new investor liquidity does not trigger a positive divergence in cryptocurrency, dull days may continue. However, some analysts believe that despite all these challenges, BTC price could reach targets above $80,000 this quarter. Institutional demand through the ETF channel further confirms this expectation. The recent drop in BTC price to as low as $70,759 could open the door for a rebound toward a new ATH.
However, closing prices below the critical $71,500 level could lead to a drop back down to $67,000.
