Crypto Assets market has once again declined, influenced by multiple factors.

Recently, the Crypto Assets market has experienced a significant correction, which has been caused by multiple factors:

1. The US stock market remains sluggish, with technology stocks being hit hard. Major stock indices are struggling to rebound, and the Nasdaq index has dropped by more than 1%.

2. A trading platform suffered a major hacking attack, resulting in losses exceeding $1.4 billion in Ethereum and related tokens, which impacted market confidence.

3. Crypto Assets investment products continue to see capital outflows, and institutional investors' risk appetite is declining.

4. The total market capitalization faces strong resistance, making it difficult to break through key resistance levels.

The US stock market drags down the Crypto Assets market

The US stock market has shown weak performance recently, which has dragged down the crypto assets market. The Nasdaq index closed down 1.2% on Monday, while the S&P 500 index fell 0.5%. Chinese concept stocks suffered heavy losses, with the Nasdaq Golden Dragon China Index dropping more than 5%.

New trends in the field of artificial intelligence have also raised market concerns. Reports indicate that a certain tech giant is scaling back its data center leasing, which may reflect a cautious attitude towards investment in AI computing power. In addition, Nvidia's upcoming financial report has also attracted attention, as its new generation of chips faces numerous challenges.

Economists point out that the risks in the U.S. labor market are increasing. Factors such as slowing real income growth and a weak real estate market may lead to economic growth falling short of expectations. Some analyses suggest that passive tightening of monetary policy is the main risk and could have a significant impact on financial markets.

Ethereum Leads the Crypto Market Decline

The Crypto Assets market continues its previous adjustment trend. In the past 24 hours, Ethereum has fallen by 11.5%, Bitcoin has decreased by 4.9%, and Solana has dropped by 15.7%. Other mainstream Crypto Assets have also generally experienced declines ranging from 5% to 15%.

A large number of leveraged positions were forcibly liquidated, further exacerbating market volatility. According to statistics, over 310,000 traders were liquidated in the last 24 hours, totaling $950 million. Liquidations of longer positions dominated, indicating that the market was overly optimistic previously.

However, industry insiders have pointed out that compared to the exchange collapse incident in 2022, the market reaction this time is relatively mild, reflecting an improvement in the maturity of the Crypto Assets ecosystem. The overall liquidity situation in the industry remains good.

Investors continue to avoid risks

Crypto Assets investment products have experienced consecutive outflows for two weeks. Data shows that as of the week ending February 21, the total outflow exceeded $500 million, with Bitcoin accounting for the largest share. This reflects that institutional investors are reducing their exposure to digital assets.

Analysts believe that uncertainties such as the U.S. elections, trade policies, and inflation trends have led investors to maintain a cautious attitude. Market participants are paying attention to the U.S. inflation data set to be released this week.

According to futures market expectations, the probability that the Federal Reserve will keep interest rates unchanged at the next two meetings is high. The probability of maintaining interest rates at the March meeting is 97.5%, and for the May meeting, it is 73%.

The market faces resistance above

From a technical perspective, the Crypto Assets market's total market capitalization is currently trading below a key supply zone. The Relative Strength Index (RSI) is around 40, indicating a tendency for the market to further decline. If it breaks below the $3.03 trillion support level, it could trigger a new round of selling, with the target potentially dropping to around $2.72 trillion.

However, some analysts believe that the market is currently in a neutral state, with the fear and greed index at 40, and investors are cautiously weighing their next actions.

Bitcoin Short-term Trend Prediction

A co-founder of a trading platform predicts that Bitcoin may drop to around $70,000. He analyzes that many ETF holders are hedge funds, and if the price drop leads to a narrowing basis, these funds may close their positions to take profits.

Another founder of a Crypto Assets hedge fund stated that $95,000 is still a decent exit price compared to potential prices in the next 6-12 months. He expects the probability of Bitcoin reaching a new high in the next three months to be relatively low.

Overall, the Crypto Assets market still faces adjustment pressure in the short term, and investors need to remain vigilant, closely monitoring changes in various factors.