XRP News Today: Crypto Market Plummets 5.66% as Fed Rate Cut Hopes Fade

The global crypto market experienced a significant decline, dropping by 5.66% and leaving many investors concerned. Bitcoin, which had recently aimed for a breakout above $109,000, fell back to around $104,000, marking a 3.6% decline in just 24 hours. This downturn was not isolated to Bitcoin; Ethereum, XRP, Solana, and even meme coins like Dogecoin followed suit, with declines ranging from 6% to 15%.

The primary factor behind this sudden crash appears to be new signals from the U.S. Federal Reserve. Following the release of the latest inflation data, which showed core CPI still above expectations and producer prices rising, the chances of a rate cut in June have nearly vanished. This shift in expectations has made investors nervous, leading to a decline in crypto prices. The market now has a 97.4% chance that the Fed will not lower interest rates this month, according to Fed CME tools.

Another significant blow came from the spot Bitcoin ETFs. After several days of strong inflows, June 12 saw a sudden reversal, with $202 million flowing out. Fidelity’s ETF alone saw a $197 million withdrawal, while ARK Invest’s ETF lost over $10 million. Surprisingly, BlackRock stayed flat with zero inflows or outflows.

Leverage traders also took a big hit. In the last 24 hours, over 247,000 traders were liquidated, with total liquidations hitting $1.15 billion. The largest single liquidation order was a $201 million long on Binance. If Bitcoin drops further to around $95,800, nearly $11.76 billion worth of long positions are at risk, which could trigger another wave of sell-offs.

Technical indicators also hint at more struggle for Bitcoin. Charts show rejection near the $106K resistance zone, and the MACD is showing a slight bullish crossover, but the momentum is weakening. If Bitcoin fails to hold $104K, we could see a retest of $102K or even $100K soon.

The altcoin market is also suffering, closely following Bitcoin’s downward trend. The Altseason Index has dropped to 16, indicating that Bitcoin still holds market dominance. Among the biggest losers, Ethereum (ETH) is now trading near $2,508. XRP, Solana, and Cardano all saw major declines, with no signs of recovery just yet.

Bitcoin and altcoins experienced a significant decline today, driven by a confluence of geopolitical risks and macroeconomic uncertainties. The primary catalyst for this downturn was the escalating tensions in the Middle East, following Israel's attack on Iran's nuclear projects. This geopolitical event triggered a risk-off sentiment across global markets, with investors seeking safe-haven assets such as gold and bonds. The heightened uncertainty led to a sell-off in cryptocurrencies, as traders braced for potential short-term volatility.

The macroeconomic landscape also played a crucial role in the market's downturn. Rising inflation data and increasing interest rates have rattled investor confidence, leading to a broader market-wide risk-off sentiment. The combination of geopolitical risks and macroeconomic uncertainties has created a challenging environment for cryptocurrencies, which are often seen as high-risk assets.

The crypto market's decline was further exacerbated by the liquidation of positions worth millions of dollars. This liquidation wave added to the downward pressure on prices, as traders were forced to sell their holdings to meet margin requirements. The liquidations also highlighted the market's sensitivity to sudden shifts in sentiment, as even a small change in market conditions can trigger a cascade of selling.

Despite the current market conditions, some analysts remain optimistic about the long-term prospects of Bitcoin and altcoins. They argue that the recent decline is a short-term dip and that the underlying fundamentals of the crypto market remain strong. However, the market's volatility and sensitivity to external factors underscore the need for caution and careful risk management.