In a recent downturn, Bitcoin‘s value plummeted to $63,500, shedding $5,500 from its all-time high (ATH). The downward movement has most significantly impacted altcoins, which had yet to experience the highs seen by Bitcoin. The market is evaluating the causes of this decline and potential further impacts.
Profit-Taking Triggers Bitcoin Sell-Off
The dip in Bitcoin’s price is attributed to a wave of profit-taking following its ATH. Investors capitalizing on profitable levels initiated a sell-off, which contributed to the price decline. Concurrently, Exchange-Traded Funds (ETFs) have also seen a surge in volume with falling prices, indicating that profit-taking is underway in this segment as well. The IBIT fund, for example, has seen volumes soar past $2 billion.
Market Anticipates Influential Economic Indicators
For Bitcoin to rally past $70,000, it needs to secure a close above the $65,000 resistance level. Nonetheless, upcoming economic indicators such as employment data, wage increases, and unemployment figures are causing market unease. Fear of missing out (FOMO) had initially driven Bitcoin’s price to its ATH, and now investors are entering a profit-taking phase, even if it is brief.
Historical trends suggest that Bitcoin typically reaches its cycle peak around 10 months after a halving event. If this pattern holds, there may be several more months before the market witnesses rapid ascents and zeroes in on the actual peak value.