Why did bitcoin drop so much, we are in the presence of a volatile market.

joeljaimes1982 (70)Authorized Userin Steem Alliance • last month

Officially there are less than 30 days left until April 20, the date on which the fourth halving in the history of bitcoin is estimated to occur, and as the date approaches, volatility and emotions continue to surface in the cryptocurrency market.

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With bitcoin experiencing strong movements in recent days that have taken us from 73,000 and historical highs that we saw last week to falling below 63,000, greatly affecting the price of the main altcoins and liquidating billions in recent days.

Why did bitcoin fall so much?

After the beginning of the month of March in which bitcoin once again broke the 70,000 barrier with force to be able to go towards new highs reaching 73,000, massive sales and another series of factors have once again shaken the market and during the Yesterday we saw how the price of bitcoin fell again to $62,000, a movement that continued the trend of recent days.

Since March 14, Bitcoin has registered a correction of more than 15% with which we have gone from almost 74,000 to 62,000, a movement that has had a significant impact on the price of the main altcoins such as solana, which after explode at the end of last week, going above $200, it fell sharply to $175, registering more than a 5% correction.

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Last Tuesday, something very similar to what happened with Ethereum, which after testing $4,000, also corrected quite a bit, falling more than 5% on Tuesday to $3,300 and registering a correction of more than 15% during the last week, the same thing. for cardano which also fell by 5% yesterday and more than 15% during the last 7 days.

For its part, Polkadot, after the good feelings it left last week, returning to $11 and awakening enthusiasm in its holders, has once again fallen below $10, registering a drop of more than 6.5% last Tuesday and accumulating more than 13% in the last week.

But why are we seeing these corrections?

There are several important factors behind all these movements. First of all, we have the United States, which after having given some hope for what seemed like a possible reduction in interest rates last week, returned to give less than optimistic data, registering a new increase. of inflation above expectations.

A fact that has alarmed investors due to the possibility that rates may continue at these levels for longer and the possible decline will be further delayed, which would also continue to put even more pressure on the economy and limit sectors such as investment, especially in the face of the announcement this week by the FED that they will surely announce the decision on interest rates for the month of March.

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According to the market, it is more than 90% discounted that the Fed is not going to reduce interest rates, a fact that has also been combined with the decision of the Bank of Japan, which this week announced an increase in interest rates, something that not seen since 2007 and which also points out that the economy is far from being recovered. Another factor that has also helped yesterday's decline is the liquidations that have once again skyrocketed after the increase in volatility.

In conclusion

The market is a roller coaster with many ups and downs before the next halving, good news or bad news could come to light that can impact the price of the cryptocurrency, obviously manipulating the market, we just have to be cautious and keep an eye on recent news.