Bitcoin prices fell to $93,131.50 on Wednesday, marking a third day of losses as traders capitalized on recent gains. The cryptocurrency’s inability to surpass $100,000 and concerns over new trade tariffs from the incoming administration exacerbated caution in the market. Meanwhile, altcoins also weakened, reacting to Bitcoin’s downturn, with Ether and other major tokens experiencing declines.

Bitcoin registered a decline for the third consecutive session on Wednesday, dropping to $93,131.50 as traders took profits from recent gains. This downturn follows a period of optimism surrounding the cryptocurrency, which had peaked near the $100,000 mark. Market sentiment was further tempered by U.S. economic policies, notably the potential for heightened trade tariffs from President-elect Donald Trump, which has rekindled concerns of a trade conflict.

The ongoing focus on U.S. economic indicators is critical, particularly the PCE price index—an essential measure of inflation preferred by the Federal Reserve—set to be released on Wednesday. Federal Reserve minutes revealed a divide among policymakers regarding the speed of future interest rate cuts, suggesting a cautious approach. A revised report on third-quarter GDP is also anticipated, contributing to the uncertain economic outlook.

The implications of Trump’s forthcoming administration for cryptocurrency remain in question, despite his pledge to position the U.S. as a leading center for cryptocurrency innovation. Traders are eager for clear signals regarding his administration’s stance on digital currencies. Recent selections for Treasury and Commerce Secretaries, who have shown support for crypto, may provide some optimism.

Furthermore, Bitcoin’s decline influenced major altcoins, which generally mirrored its weakness with most experiencing losses. The second largest cryptocurrency, Ether, fell by 0.4% to $3,419.99, while other tokens such as XRP, Solana, Cardano, and Polygon registered declines ranging from 0.9% to 5%. Notably, Dogecoin, among meme tokens, also faced a drop of 3%.

The recent decline in Bitcoin’s price is pivotal as it follows a significant rally that had propelled its value toward new highs. Market tendencies often reflect broader economic uncertainties, particularly in response to policy announcements or financial data releases. As traders engage in profit-taking during corrections, the interconnectedness of cryptocurrencies with traditional economic indicators cannot be overlooked. Notably, Bitcoin has been in contention for the threshold of $100,000, indicating an evolving market maturity and fluctuating investor sentiment, particularly surrounding upcoming U.S. economic reports and political intentions under the incoming Trump administration.

In summary, Bitcoin’s recent decline reflects a broader trend of caution among traders amidst profit-taking and external economic pressures. With impending U.S. economic data release, including inflation metrics, and the potential for increased trade tensions under President-elect Donald Trump, market participants are closely monitoring developments. The ripple effect on altcoins further signifies the interconnected nature of cryptocurrency markets, highlighting the need for vigilant observation as traders await clarity on policy impacts.

Original Source: www.investing.com

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