Bitcoin’s price fell below $90,000 for the first time in eight weeks on Jan. 13, following a 12.5% drop over seven days. Despite this decline, Bitcoin derivatives metrics indicate a neutral to bearish outlook. Market participants remain optimistic due to the premium of monthly futures contracts and positive funding rates.
The decline is partly attributed to investor sentiment, which worsened after the S&P 500 index fell below 6,000 on Jan. 6. The US jobs report raised concerns about the Federal Reserve keeping interest rates elevated. This uncertainty pushed the 10-year US Treasury yield to its highest level since November 2023.
The appreciation of the US dollar against foreign currencies indicates that major investors are taking a cautious stance, favoring cash and short-term bonds. Geopolitical tensions after stricter sanctions on Russian crude oil exports also contributed to the market’s downturn.
Some analysts argue that Bitcoin’s recent performance relies heavily on MicroStrategy. The company’s latest purchase added 2,530 BTC to its total holdings. However, US-listed spot Bitcoin ETFs saw $718 million in outflows over two days, raising questions about institutional demand.
Investors are now prioritizing safety due to concerns about a potential global economic slowdown. This environment may dampen short-term appetite for Bitcoin as investors focus on safer assets.
Source: https://cointelegraph.com/news/bitcoin-price-dip-below-90-k-driven-by-investors-bracing-for-upcoming-economic-risks