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The crypto market followed Bitcoin’s lead and fell roughly 2% in the past 24-hours to hit a two-week low below $2.65 trillion.
Meanwhile, a wave of liquidations during late US hours on Sunday added further fuel to the sell-off.
Market sentiment has deteriorated over the past 48 hours, with the crypto fear and greed index dropping 5 points since May 16.
Most major altcoins remained muted throughout the day, with gains limited to only a handful of outliers.
Why is Bitcoin price going down?
Bitcoin and the broader crypto market have been affected by a number of macroeconomic factors today.
First, traders were quick to react to rising interest rates as global bond yields jumped.
In the US, Treasury yields ticked higher as sticky inflation data kept monetary policy restrictive.
A similar scenario has also unfolded in Japan, where government bond yields hit multi-year highs.
At the same time, global bond yields have exerted downward pressure on non-yielding assets.
All of this hawkish sentiment has significantly lowered the odds of an upcoming rate cut in the near term.
According to the CME FedWatch tool, the odds that the Federal Reserve will keep interest rates unchanged stand at 99.2%.
Against this backdrop, institutional demand across major ETFs for leading cryptocurrencies like Bitcoin and Ethereum has slowed.
Bitcoin ETFs specifically have seen net outflows of over $1 billion over the past week.
Bitcoin has lost a key psychological level
Traders are also reacting to Bitcoin losing the $80,000 level, which was seen as key to maintaining the upside momentum that was seen ahead of Thursday’s CLARITY Act markup vote.
As Bitcoin price fell below $80,000, overleveraged long positions were forcefully closed, which led to a cascade of liquidations.
According to CoinGlass data, over $670 million was wiped out and liquidated in the past 24 hours, with Bitcoin and Ethereum accounting for the majority of the losses.
Bitcoin long positions accounted for roughly $200 million, while Ethereum long positions made up over $264 million of the total.
Traders remain cautious ahead of a busy week for economic data
The US economic calendar is packed this week from May 18 to May 22.
Reports on existing and pending home sales, weekly ADP employment changes, jobless claims, manufacturing activity, and consumer sentiment are all due.
Meanwhile, the FOMC minutes due on Wednesday will be closely watched for clues on future rate decisions.
Another key market driver is Nvidia’s upcoming first-quarter fiscal earnings results, which have often served as a major catalyst for risk assets like Bitcoin.
Will Bitcoin price recover?
Despite the recent pullback, some factors are lining up in favor of Bitcoin and the broader crypto market.
Firstly, a number of major institutional players like Strategy (previously known as Microstrategy) and Capital B have continued buying Bitcoin.
Strategy, for instance, recently disclosed that it has acquired an additional 24,869 Bitcoin ($BTC) for $2.01 billion between May 11 and 17.
Meanwhile, Capital B also bought the dip, acquiring 192 $BTC for 13 million euros at an average price of $78,948 per Bitcoin.
Such large-scale institutional accumulation could help cushion the asset against any further downside in the short-term as macro conditions stabilise.
Altcoin market remains muted
The altcoin market remained relatively quiet today, with only six tokens managing to close with gains of over 1% at the time of publication.
Leading altcoins like Ethereum (ETH), $BNB ($BNB), Solana (SOL), and $XRP ($XRP) all held losses between 1-5% in the past 24 hours.
$KITE leads altcoin with 10% rally
Kite ($KITE) was the only altcoin to secure double-digit gains on the day, primarily due to project-specific developments.
Kite ($KITE) is capitalising heavily on the growing market focus on the AI Agent narrative.
Over the last few weeks, investors have actively rotated capital into infrastructure tokens that facilitate autonomous AI commerce, pushing assets like $KITE, Humanity (H), and Injective (INJ) to the top of the gainers' list.
The primary catalyst behind the sustained bullish structure is the transition from testnet to the live Kite Chain mainnet alongside the rollout of the Kite Agent Passport.
Because $KITE functions as the native utility layer for autonomous AI agent identity, cryptographic spending limits, and stablecoin micropayments, the launch marked a shift from speculative prototyping to real-world infrastructure usage.
According to the 4-hour $KITE/USD chart, the token remains in a strong short-term uptrend after breaking above all major EMAs.
$KITE was trading around $0.233 at the time of writing while holding above the 20 EMA at $0.217 and the 50 EMA near $0.204, showing that buyers still control momentum.
The RSI has climbed above 73, entering overbought territory for the first time since March.
Previous moves into this zone often led to short consolidation phases before continuation higher.
If bullish momentum holds, $KITE could retest the recent $0.25 high, with a breakout potentially opening the path toward the broader $0.28 to $0.30 resistance area.
On the downside, the $0.217 and $0.20 levels remain the key support zones that traders will likely watch closely.