Bitcoin Plunges Below $54,000, US Stocks Suffer Major Losses as Market Volatility IntensifiesAccording to Coinglass data, Bitcoin has dropped over 4%, breaking below the $54,000 mark, while Ethereum has seen an even steeper decline of over 6%. In the past 24 hours, over 86,000 traders have liquidated their positions in the cryptocurrency market
Bitcoin Plunges Below $54,000, US Stocks Suffer Major Losses as Market Volatility Intensifies
According to Coinglass data, Bitcoin has dropped over 4%, breaking below the $54,000 mark, while Ethereum has seen an even steeper decline of over 6%. In the past 24 hours, over 86,000 traders have liquidated their positions in the cryptocurrency market. This decline is partly attributed to the recent downturn in market confidence. Earlier this year, inflows into US spot Bitcoin exchange-traded funds (ETFs) had fueled Bitcoin's price rise, but this trend has failed to sustain, and recent investor withdrawals have led to its price fall.
Beyond the cryptocurrency market, US stocks also suffered a sharp decline on September 6th. The Dow Jones Industrial Average fell 1.01%, the S&P 500 index dropped 1.73%, and the Nasdaq plunged 2.55%. Amazon and American Express led the decline in the Dow, while Tesla, Nvidia, and other tech companies experienced substantial losses. Most Chinese ADRs also fell, with Legend Biotech and Jikrypton seeing significant drops. Meanwhile, prices of commodities like gold, silver, and oil also declined.
This market volatility could be linked to the recent release of US economic data and statements from Fed officials. The US August nonfarm payroll report showed a job growth of 142,000, lower than expectations. While US White House Council of Economic Advisers Chair Jared Bernstein called the job growth robust, Federal Reserve Vice Chair for Supervision Michael Barr suggested that lowering the federal funds rate was appropriate and that he was more confident about inflation returning to 2%. He signaled a move towards neutral policy, but did not specify the size of the first rate cut.
Around 9:30 PM Beijing time on September 6th, following comments from Fed officials, Wall Street investors deemed the expectation of a 50-basis-point rate cut less likely, leading them to sell off their US stock holdings, particularly tech stocks. This triggered a widespread decline in the markets overnight. Shifting expectations regarding the Fed's monetary policy and concerns about the economic outlook have become the main drivers of the market turbulence.
Currently, market sentiment remains cautious, and investors need to pay close attention to future Fed policy moves and global economic trends. With a volatile September, US stocks may face a significant downturn, and investors should proceed with caution and manage their risk.
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