"At present, Bitcoin continues to trade as a risk-on asset, once again slipping below the $90,000 level. Recent price action shows that the cryptocurrency remains highly sensitive to movements in traditional financial markets, particularly U.S. technology stocks and expectations surrounding monetary policy. Bitcoin's rejection at the $100,000 level and its inability to maintain stability above the psychological $90,000 threshold reflect a dominant cautious sentiment. Investors appear to be reducing risk exposure toward year-end, prioritizing capital preservation after the strong rally seen earlier in the cycle."
"The most important macroeconomic factor influencing Bitcoin in the short term remains the policy direction of the U.S. Federal Reserve. Although the Fed has implemented interest rate cuts, its accompanying guidance has remained cautious, indicating that this is not yet the beginning of an aggressive monetary easing cycle. Real interest rates remain relatively elevated, while the Fed continues to emphasize a careful approach amid the risk of inflation re-emerging."
"As a result, global liquidity has not fully returned, thereby limiting Bitcoin's upside potential in the near term. In addition to monetary policy, flows into spot Bitcoin ETFs continue to be a key determinant. Following a period of significant outflows, the market has recently seen a slowdown in capital movements, which has helped interrupt Bitcoin's downside momentum. However, current institutional demand is still not strong enough for Bitcoin to establish a clear new uptrend."
Bitcoin is trading as a risk-on asset and has slipped below $90,000, showing sensitivity to U.S. technology stocks and monetary policy expectations. The cryptocurrency was rejected near $100,000 and failed to sustain levels above $90,000, reflecting cautious investor sentiment. Investors are reducing risk exposure toward year-end and prioritizing capital preservation after an earlier strong rally. U.S. Federal Reserve policy remains the most important short-term macro influence; rate cuts have been accompanied by cautious guidance and still-elevated real rates, preventing a full return of global liquidity. Spot Bitcoin ETF flows have slowed after significant outflows, and current institutional demand is insufficient to establish a new uptrend.
Read at London Business News | Londonlovesbusiness.com
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