Bitcoin recently tested the $42,000 level for the fifth time following a sharp decline on January 12, which also negatively affected altcoins, causing a 5% loss in MATIC Coin among others. Despite the U.S. approving its first spot Bitcoin ETFs, Bitcoin’s price struggles to stay above the $42,000 mark, defying expectations that the long-awaited ETF approvals would significantly boost prices. Even though the anticipation of spot Bitcoin ETF approvals had previously driven the price to nearly $49,000 when Bitcoin was around $25,000, the price could not maintain stability at the peak during this volatile period.
While there haven’t been major losses, bulls lack the momentum to push the price higher. Bitcoin has broken below the ascending parallel channel that started in December, with a potential target of $38,000 if the downtrend gains momentum. The cumulative value target for cryptocurrencies is around $1.4 trillion.
The market is digesting the ETF approvals, which initially reduced trading volumes, and a reversal of the downtrend may occur as GBTC sales return to normal levels. Currently, technical breakdowns suggest that losses may continue. The upcoming Federal Reserve meeting at the end of the month also contributes to the market’s anxiety.