The price of Bitcoin plunged to an intraday low of $40,269 earlier today on the Bitstamp exchange.
The flagship cryptocurrency is down roughly 4% over the past 24 hours. It is now precariously close to retesting the $37,000 support level.
The U.S. dollar index (DYX) has rallied above 100 for the first time since May 2020 amid the U.S. Federal Reserve's hiking cycle. The greenback's ongoing rally highlights strong risk-off sentiment.
Goldman Sachs believes that the Fed will raise the benchmark interest rate by 50 basis points in May and in June in order to bring down inflation.
Mike Novogratz recently predicted that the Bitcoin price could rally again if the Fed were to put monetary tightening on pause. However, the central bank might not change its course anytime soon due to persistently high inflation.The 10-year U.S. Treasury yield reached a three-year peak earlier today, spiking to as high as 2.78% earlier today. As reported by U.Today, former BitMEX CEO Arthur Hayes recently predicted that the price of Bitcoin could plunge to as low as $30,000 by the end of the second quarter, triggering a broader "crypto carnage." Bitcoin’s correlation with the tech-heavy Nasdaq 100 index, which includes such stocks as Tesla and Microsoft, recently achieved yet another record peak. This may be bearish for Bitcoin due to the recent underperformance of tech stocks.
The price of the top cryptocurrency is currently down 41.43% from its record peak. Bitcoin is still up 23.25% from its 2022 low of $32,950.
Last week, veteran trader Peter Brandt opined that the next bull market cycle might not start until 2024.