Crypto, the only resilient cryptocurrency, is also beginning to falter. In the early hours of February 1st, it plunged to $75,000.
Nearly a year later, we've seen Bitcoin again with a 7 in its name. The peak of the 2021 bull market was $69,000, which is very close.
As is customary, we still need to find the reason.
Geopolitical conflict
First, there is the international conflict. On X, which is known as the place where the world's fastest news breaks, several videos show explosions in multiple locations in Iran. So far, neither the United States nor Israel has spoken out, and it is still impossible to determine the authenticity of the videos.
Iran is still conducting military exercises in sensitive areas, demonstrating its complete lack of fear.
Of course, the conflict between the US and Iran appears to be something that is publicly known but not confirmed in the market. The movements of the US aircraft carrier and Iran's response a few days ago caused a sharp drop in global risk assets, including gold. Increased uncertainty always causes Bitcoin, which trades 24 hours a day, to fluctuate first.
Government shutdown
The US government officially began a partial shutdown in the early hours of the 31st local time. How fast time flies! It feels like just last year that the last shutdown happened.
The U.S. Senate previously passed a spending bill that would fund most of the federal government and sent it to the House of Representatives for consideration. However, because House members are not in Washington and will not return until Monday (February 2), the Senate vote could not prevent a partial government shutdown.
Referring to the last record-breaking government shutdown, this one seems less severe, but it's still not a good thing. The main reason is that hundreds of billions of dollars in liquidity are locked up, and with the weekend already causing poor liquidity, the situation couldn't get any worse.
Fear of Monday
The epic plunge in gold and silver prices, coupled with rumors circulating online that some US banks have already begun to collapse, means the market is still pricing in uncertainty. What will happen on February 2nd is on everyone's mind.
Where will it fall to?
Chris Burniske, a partner at Placeholder VC, previously stated that key support levels to watch are $80,000, $74,000, $70,000, $58,000, and $50,000 and below. Short-term price fluctuations are not the core focus. If prices rebound, hold and gradually diversify your portfolio. If there is a deep pullback, consider it an opportunity to add to your Bitcoin and other high-quality crypto assets.
Trader Merlijn The Trader previously stated that a key support level for Bitcoin is around $80,000, and historical data shows that approximately 127,000 BTC were bought in that price range previously.
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