Why is Bitcoin price down today?

Bitcoin

BTC

$64,807

has started August on a bearish note as the market’s attention turns toward the recent Federal Reserve guidance on interest rates and Kamala Harris’s improving odds against her pro-crypto candidate, Donald Trump, in the United States presidential elections.

Fed keeps rates unchanged for July

On July 31, Federal Reserve Chairman Jerome Powell said they would keep the benchmark interest rates unchanged at the current 525-550 basis points, albeit favoring a cut in September if inflation continues cooling down.

Bitcoin started slipping during the Powell conference, eventually dropping by 5% to reach around $63,400 on Aug. 1.

*BTC/USD hourly price chart. Source: TradingView*

The BTC price reaction is akin to its previous responses to the Fed’s rate decisions in 2024.

For instance, after the conclusion of the Federal Open Market Committee (FOMC) on June 12, the price slipped by around 7.25%. Similarly, it dropped by over 7% after the FOMC’s May 1 meeting.

This pattern of declines following each FOMC meeting underscores a growing de-risking trend among investors. As the Federal Reserve’s policy decisions and economic outlook create uncertainty, investors often reduce their exposure to riskier assets, a reason why Bitcoin price is down today.

Kamala Harris may trump Trump

Bitcoin’s price declines today appear further due to increasing odds of Kamala Harris winning the US elections in November against her pro-crypto opponent, Donald Trump.

On July 31, Harris gained ground in key swing states for the first time since launching her presidential campaign, receiving 48% approval versus Trump’s 47%. Her winning odds have also improved on the Polymarket betting platform, albeit lagging behind Trump.

*US presidential election winner odds. Source: Polymarket*

If investors perceive an increased likelihood of stricter cryptocurrency regulations under a potential Democratic administration, Bitcoin’s price could decline. Harris’s gaining ground in key swing states might amplify these concerns.

Mt. Gox moves another BTC tranche

Bitcoin’s decline today follows the July 30 transfer of 47,000 BTC, valued at approximately $3.02 billion, from Mt. Gox to the crypto exchanges Kraken and Bitstamp. This transfer is part of the ongoing process of distributing the recovered funds among Mt. Gox’s creditors.

*Mt. Gox Bitcoin balance. Source: Arkham Intelligence*

The transfer period coincided with heightened selling activity on one of the designated exchanges, Kraken.

According to the data analytics platform Glassnode, Bitcoin’s Spot Cumulative Volume Delta (CVD)—which measures the net difference between buying and selling trade volumes—has been skewed toward sellers since July 27 and was the highest on the day of the Mt. Gox transfer.

Bitcoin CVD on Kraken exchange. Source: Glassnode

Bitcoin pulls back from multi-month resistance

From a technical perspective, Bitcoin’s decline is part of an ongoing correction that began after it tested the resistance of a multi-month falling trendline, which forms part of a broader descending channel pattern.

*BTC.USD daily price chart. Source: TradingView*

As of Aug. 1, BTC’s price was above its 50-day exponential moving average (50-day EMA; the red wave) at around $64,300, eyeing a rebound toward the channel’s upper trendline at approximately $68,250.

However, if Bitcoin decisively breaks below the 50-day EMA support, it will likely fall further toward the range defined by its 200-day EMA (the blue wave) and the channel’s lower trendline. This range aligns with the $59,500-54,500 area.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.