Bitcoin Crash Coming? Experts Warn of 75% Drop Amid Market Chaos!

Tuesday brought a crash warning to the financial markets, with the S&P 500’s 2% drop sending ripple effects across the crypto market, leading to a significant Bitcoin Crash. Bitcoin was hit particularly hard, with a 4.5% drop raising concerns of a potential major downturn. Significant liquidations and bearish signals from key technical indicators further complicate the situation.

This is what it means for you!

Bitcoin Struggles in Sync with S&P 500 Drop

The S&P 500’s fall on Tuesday sent shockwaves through both traditional and digital asset markets. While the index fell 2.12%, Bitcoin followed suit, falling 4.5% to the $56,500 level. The sharp drop led to a surge in Bitcoin liquidations, exacerbating the downward pressure on the cryptocurrency. According to data from Coinglass, approximately $246.64 million in leveraged positions are at risk of being wiped out if Bitcoin falls below $56,840, a level it has already broken.

Stochastic RSI signals a potential 75% crash

Crypto analyst Ali Martinez has highlighted the bearish signals emerging from Bitcoin’s Stochastic RSI on the 2-month chart. The indicator, which tracks momentum and market conditions, has shifted from a bullish to a bearish trend. Martinez noted that similar signals have often preceded significant corrections, with Bitcoin experiencing drops of around 75.50%. If history repeats itself, Bitcoin could be in for a serious downturn, adding to market concerns.

Peter Brandt’s pessimistic outlook

Noted trader Peter Brandt has also turned bearish on Bitcoin, citing the cryptocurrency’s recent pattern of lower highs and lower lows. This market structure suggests a lack of strong buying interest, which could lead to further declines. Brandt’s analysis suggests that Bitcoin risks continuing its downward spiral without a momentum rebound.

The bearish sentiment is reinforced by spot Bitcoin ETF outflows, with over $287 million leaving the market on Tuesday. This indicates that institutional investors are turning away from risky assets like Bitcoin, further contributing to the sell-off. With these major players pulling back, the market’s ability to recover in the near term could be hampered.

What’s the reason for the S&P 500 decline?

The broader market drop was sparked by a subpoena from the U.S. Department of Justice (DOJ) against chipmaker Nvidia. The news caused Nvidia’s shares to drop 10%, causing other major tech companies and the S&P 500 to fall as well. The resulting turmoil spilled over into the crypto market, leading to widespread losses across major cryptocurrencies including Bitcoin and several altcoins.

What awaits us?

All eyes are now on the US Federal Reserve, which is expected to cut interest rates by 50 basis points on September 18. This decision could play a crucial role in determining whether Bitcoin can recover or whether the bears continue to have the upper hand. The coming days will be crucial as Bitcoin faces bearish signals, institutional outflows, and market instability.

Also Read: Bitcoin Price Drops To $40,000? Key Indicator Signals Fall, Says Renowned Chart Analyst