Crypto Market Pulls Back as Traders Reassess Amid Macro Headwinds

After setting a series of new all-time highs, the crypto market has shifted lower, with traders booking profits and macroeconomic concerns resurfacing.

Bitcoin (BTC) dropped to $113,500 on Tuesday, down more than 1.5% from the previous day and over 8% from last week’s high above $124,000. Analysts point to weakening technicals, with BTC slipping below its 50-day moving average—a key support line for the recent rally.

“This drop back to levels seen two weeks ago suggests mounting pressure for a deeper correction,” said Alex Kuptsikevich, chief market analyst at FxPro. “A decline toward the $100,000 mark, near the 200-day moving average, remains on the table if momentum doesn’t recover.”

The total crypto market cap fell another 0.4% to $3.87 trillion, further reinforcing concerns of a broader pullback. Some traders now eye the $3.6 trillion zone as the next key level.

Ethereum (ETH) mirrored bitcoin’s retreat, sliding 1.8% to $4,159. The token is now more than 12% off its recent high and hovering near the $4,100 support zone, which previously acted as resistance earlier this year.

Elsewhere, XRP fell 4.1% to $2.89, Dogecoin (DOGE) dropped 2.4% to $0.2185, and Cardano (ADA) led the decline among major altcoins, losing 6.6%.

Macro Pressures and Leverage Take Center Stage

The mood across markets has shifted quickly following last week’s hot U.S. inflation print, which dimmed expectations for swift rate cuts from the Federal Reserve. The macro uncertainty, combined with stretched positioning, triggered widespread profit-taking.

“Bitcoin has been in a modest correction since last week’s peak,” said Joel Kruger, market strategist at LMAX Group. “The hotter-than-expected inflation data has disrupted the bullish narrative and spurred risk-off flows.”

Ethereum has not been spared, with leveraged long positions facing pressure. However, strong institutional demand continues to underpin confidence.

“Despite the pullback, ETF inflows into ETH products and growing corporate treasury allocations suggest a solid medium-term foundation,” Kruger added.

Leverage Amplifies Volatility

According to Ryan Lee, chief analyst at Bitget, the growing levels of open interest in futures markets show just how much leverage is currently in play.

“That leverage can work both ways—fueling rallies or accelerating sell-offs depending on sentiment,” Lee said. “Right now, it’s adding to market fragility.”

Jackson Hole in Focus

Investor attention is now turning to this week’s Jackson Hole symposium, where Fed Chair Jerome Powell is expected to outline the central bank’s monetary stance for the months ahead. The address could spark renewed volatility across equities, crypto, and currency markets.

While recent price action suggests a cooling phase, many analysts maintain a constructive medium-term outlook, pointing to ongoing institutional interest and strong crypto fundamentals.