Bitcoin and Crypto Enter Steep Correction, Next BTC Price Stop at $23,500?

In hours following Jerome Powell’s announcement of keeping interest rates unchanged, Bitcoin and the broader cryptocurrency market have entered a steep correction. The Bitcoin (BTC) price is down over 3.5% in the last 24 hours and has moved closer to the $25,000 level.

Similarly, the broader cryptocurrency market has eroded over $40 billion of investors’ wealth and is on the verge of falling under the $1 trillion mark.

As of now, $25,000 stands as a strong support level for Bitcoin (BTC), and any fall under this could push it further down to $23,500 and below.

Popular crypto analyst Ali Martinez reported: “Bitcoin sits on thing ice! Notice the most important support zone is between $22,785 and $23,595 where 1.34 million wallets hold 450,000 $BTC. On the flip side, #BTC faces stiff resistance between $26,000 and $28,250 where 5.18 million wallets bought 2.1 million BTC”.

As we have seen, so far in 2023, the correlation between Bitcoin and US equities has divulged to a great extent. After the Powell speech on Tuesday, the US equities ended flat as the US Fed Chair hinted at the possibility of two more rate hikes ahead this year.

Bitcoin and the crypto market have reacted quickly to this since the market is already facing liquidity challenges in the wake of the SEC lawsuits on crypto exchanges Binance and Coinbase. Already several banking partners have been reconsidering their ties with the crypto exchange in the wake of the current developments.

Altcoins Face Deeper Correction Than Bitcoin

Along with Bitcoin, the correction seems more pronounced in the altcoins space. The world’s second-largest crypto Ethereum (ETH) has tanked by more than 5.5% and has currently slipped under the $1,650 levels.

Other top ten altcoins such as BNB, XRP, Cardano ADA, and Polygon MATIC, have all corrected over 6%. The bears seem to have taken a clear hold of the markets over the bulls and it remains to be seen how far the market can correct further from here.