The 13th of December will be etched into the annals of crypto history after the price of Bitcoin lost its support level of $47,000, and the prices of altcoin dropped by around 25% within seconds. When this event took place, most analysts believed that the price correction of 8.5% was directly connected to the meeting of the Federal Open Market Committee, which started on the 15th of December.
Bitcoin Price In Heavy Trouble
Most of the investors are quite afraid that the Federal Reserve would eventually begin tapering, which is a reduction of the repurchasing program of the Federal Reserve bond. The main logic behind this is that a revision of the monetary policy currently in use could negatively impact far riskier assets.
Although there is no way of ascertaining such a hypothesis, Bitcoin has already had a 67% year-to-date gain until the 12th of December. Therefore, it does make even more sense for investors to start pocketing the profits ahead of the market uncertainties in place- which could then be connected to the current price correction seen in the cryptocurrency.
The price of Bitcoin did retrace by 8.2% over the last week, but then it also went beyond the broader market of altcoin. This is quite in stark contrast to the last 50 days it has been under operation, simply because the leading market share of the cryptocurrency went down from a sum of 47.5% to 42%. Investors could have chosen the option to flee the cryptocurrency due to the lesser risk it possesses compared to other altcoins.
Keeping in mind that most of the cryptocurrencies did manage to suffer some considerable losses on the 13th of December, the overall market structure did hold up pretty nicely. Now, had there been more demand for shorts who were keen on betting on a price drop for Bitcoin below the price of $46,000, the perpetual futures eight-hour funding could have dipped below 0.05%.