Bitcoinย (BTC) price briefly dropped below the $26k level on May 25 as investors panic owingย to political partisanship in debt ceiling talks. Fitch Rating placed theย Unitedย States โAAAโ credit rating on negative watch as Unitedย States President Joe Biden and Republicans debt ceiling talks failing to reach bipartisanship.
The cryptocurrencyย marketย capitalization slides 2 percent more on Thursday to extend its fall thisย comingย week. The worldwide cryptocurrencyย marketย capitalization now reaches below $1.10 trillion, with top cryptoย altcoins such as Ethereumย (ETH), XRPย Rippleย (XRP), Cardanoย (ADA), Polygon, and Solana (SOL) near to breaking key support levels.
Fitch May Downgrade Unitedย States Rating To Negative Amid Debt Ceiling Impasse
Rating agency Fitch placed United Statesโ โAAAโ Long-Term Foreign-Currency Issuer Default Rating (IDR) on Rating Watch Negative. Fitch stated it will downgrade the rating if President Joe Bidenโs administration and congressional Republicans doย not raise or spend the debt limit by June 1.
Treasury Secretaryย Janet Yellen warnedย that the Unitedย States Treasury will run out of funds by June 1. Theย Treasury General Accountย dropped to $57 Billion from $316 Billion earlier in May, with the opening balance of $636 Billion this fiscal year.
Fitchโs downgrade will affect debt securities, treasury bills, and the countryโs post-default ratings. An S&P downgrade of the Unitedย States rating in 2011 caused other downgrades and substantial sell-off in stock markets.
โ Nonetheless, we believe dangers have risen that the debt limit wonโt be be raised or stopped before the X-date and consequently that the Government could begin to miss payments on some of its obligations.โ
Asian stock market opened lower amid growing Unitedย States debt default danger and the Treasury running out of funds thisย comingย week. Althoughย while House Speaker Kevin McCarthy is confident about a deal before the June 1 deadline, but selloff has already started owingย to debt ceiling brinkmanship.
Inย theย meantime, the Unitedย States dollar rises over a 2- 30ย days high with the Unitedย States Dollar Index (DXY) advancing over 104. Theย potential of a price hike pause by the Unitedย States Fed in June persistsย to decline, accordingย to CME FedWatch Tool.
Bitcoinย (BTC) Price To Break Below 200-WMA
Bitcoin price is expected to end the week below the key 200-WMA. A substantial selloff will follow if the price fails to rebound before the weekโs close. Bitcoin price asย ofย now trades near the $26,000 level and Ethereumย (ETH) price broke below $1800.
Veteran traderย Peter Brandt warnedย cryptocurrencyย investors of Bitcoin price probably breaking below $25k to theย following support at $24.8k
