Bitcoin continues its historic descent, marking seven consecutive weeks of losses—the longest streak since early 2023. As Federal Reserve policy repricing rattles crypto markets, analysts warn that the world's largest cryptocurrency could face its most challenging quarter in six years, with recovery attempts potentially forming a dangerous bull trap.
Bitcoin's recent price action has sent shockwaves through the cryptocurrency community, as the digital asset extends its losing streak to seven consecutive weeks—a downturn not seen since the tumultuous period of early 2023. The sustained decline has positioned BTC for what could be its worst quarterly performance since the brutal bear market of 2018, raising concerns among investors about the strength of the current market cycle.
The primary catalyst behind this extended slump appears to be the recalibration of Federal Reserve rate expectations. After a period of optimism regarding potential rate cuts, markets have been forced to reassess their timeline as persistent inflation concerns and robust economic data suggest the central bank may maintain its restrictive monetary policy longer than previously anticipated. This repricing has had a cascading effect across risk assets, with Bitcoin bearing the brunt of the crypto market's pain.
Technical analysts are now warning of a potential bull trap scenario, where brief price recoveries could lure investors into premature buying positions before another leg down. This pattern has characterized several failed rally attempts over the past several weeks, with Bitcoin struggling to maintain momentum above key resistance levels.
The current quarter's performance starkly contrasts with the bullish sentiment that dominated late 2023 and early 2024, when Bitcoin surged past $100,000 following the approval of spot Bitcoin ETFs in the United States. That euphoria now feels like a distant memory as macro headwinds continue to pressure cryptocurrency valuations.
Despite the gloomy near-term outlook, some market participants remain optimistic about Bitcoin's long-term prospects. They point to the asset's historical tendency to recover from extended drawdowns and the strengthening fundamentals underlying the broader cryptocurrency ecosystem. However, in the immediate term, traders appear focused on Federal Reserve policy signals and broader economic indicators that could provide clarity on the direction of interest rates.
As Bitcoin navigates this challenging environment, the coming weeks will prove critical in determining whether the current losing streak represents a healthy correction within a broader bull market or signals a more significant shift in market structure. For now, caution remains the prevailing sentiment among cryptocurrency investors.