Bitcoin’s (BTC-USD) attempt to break past the $64,500 mark has hit a snag, with the cryptocurrency losing steam in the face of economic challenges. Over the seven days leading up to September 25, Bitcoin surged by 8.2%, briefly touching $64,816, but resistance around the $64,500 level has proved tough to overcome. According to Yahoo Finance, weak macroeconomic data and fears of a stock market correction are weighing heavily on investor sentiment.
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Economic Pressures Slow Bitcoin’s Momentum
A key factor dampening enthusiasm for Bitcoin is broader concerns about the global economy. In the U.S., the median price of new homes fell by 4.6% year-over-year in August, marking the longest streak of home price declines since 2009, according to Yahoo Finance. This trend, combined with high housing inventory, has led to increased caution among investors.
Meanwhile, across the globe, China’s central bank announced a significant $142 billion credit line for businesses and individuals to stimulate its slowing economy. However, according to Nomura analysts, these measures fall short of reversing the economic slowdown, which has further fueled investor jitters. All of this economic uncertainty is leaving Bitcoin traders on edge, as they look for signs of stability in traditional markets.
U.S. Elections Add to the Anxiety
The upcoming U.S. presidential election is adding yet another layer of uncertainty for Bitcoin investors. Democratic candidate Kamala Harris is viewed by many in the industry as maintaining a “relatively hostile environment for crypto,” according to Alex Svanevik, CEO of blockchain analytics platform Nansen. On the flip side, some Bitcoin bulls are rooting for Republican candidate Donald Trump, who has shown support for Bitcoin miners and even participated in Bitcoin-related events.
As the election race remains tight, traders are cautious. The Bitcoin futures premium has hovered around a neutral 6%, reflecting a lack of conviction in the market. While Bitcoin saw a rally in early September, sentiment in the derivatives market hasn’t followed suit, leaving many traders on the sidelines for now.
Where Does Bitcoin Go from Here?
For now, Bitcoin’s performance remains tethered to the broader economic outlook and political developments. Whether it can break past its current resistance levels will depend on how these external factors evolve in the coming months.
At the time of writing, Bitcoin is sitting at $63,796.33.
