Bitcoin fails to hold $59,000 amid strong downward pressure – London Business News | Londonlovesbusiness.com

Bitcoin remains below $59,000 as it continues to slide since last Saturday. Ethereum is trying to hold above $2,300 after hitting a one-week low today.

Cryptocurrency declines and lackluster performance come as multiple downward pressures build up against the absence of sufficient bullish factors to stop the successive losses.

Bearish bets on US bitcoin spot ETFs are increasing and the short volume has been rising since around the middle of last week.

This was in contrast to the ETFs recording net positive inflows last Friday of more than $263 million according to SoSo Value, the highest in nearly two months and helped push Bitcoin temporarily to $60,000 for the first time this month.

Crypto exchanges’ bitcoin balance continues to increase, indicating that investors may be intensifying their selling after depositing it there. That balance has grown from 3 million in late August to 3.019 million today, according to Cointelegraph.

Futures market moves also don’t seem to be in favor of reclaiming gains. More than $190 million in long positions on cryptocurrency futures have been liquidated since Saturday, and since then, shorts have accounted for just over 50% of total volume, according to CoinGlass.

Derivatives markets could also be rattled by the next steps the Bank of Japan might take if it decides or speaks about its intention to raise interest rates and move toward further monetary tightening. Higher rates would increase the cost of financing leveraged positions, which could prompt investors to close them. The central bank is unlikely to move rates at its meeting this week.

The Federal Reserve is also set to announce its interest rate decision this week. The market is pricing in a 65% chance of a 50% Fed cut, according to the CME FedWatch Tool. While this rapid rate cut would provide a further boost to risk appetite in the markets, I do not expect it to be enough to support the historical crypto gains we have seen earlier this year.