Bitcoin got a temporary boost last week after the Federal Reserve announced an interest rate cut. The price briefly soared, almost hitting $118,000 – a monthly high! But the party didn’t last.
The Price Dip
By the next day, the price had fallen back to around $115,500. So, is this the beginning of a major crash?
No Signs of a Market Crash
According to Alphractal, a market analytics firm, Bitcoin is nowhere near a major crash. They’ve been tracking this for over a year (since July 2024) using their Market Capitulation Index.
Understanding the Index
This index measures market stress using three key signals:
- Hash capitulation: A big drop (over 30%) in the Bitcoin mining hash rate over 30 days.
- Price capitulation: A massive price drop (over 50%).
- Supply capitulation:
A surge in the 7-day active Bitcoin supply (over 15%).
Each signal adds a point to the index. Scores between 2-3 indicate serious market stress, while 0-1 suggests normal conditions. Currently, the index is at zero – meaning no signs of panic selling. In fact, the Bitcoin mining hash rate just hit a new all-time high!
The Big Picture
While Bitcoin’s price hasn’t been amazing lately, it’s mostly been sideways, not in a freefall. Alphractal predicts it could be months before we see a real crash. This suggests there’s still potential for further price increases in this bull market.
Current Bitcoin Price
As of now, Bitcoin is trading around $115,400, down over 2% in the last 24 hours.
