London, England, 2nd Nov 2021, ZEXPRWIRE, Recently, bitcoin’s price fell to $58,132 as traders grabbed profits following a record-breaking rise as the euphoria about the first cryptocurrency ETF in the United States faded reported by Victoria-Coins broker Mark Schmitt.
A tale of fluctuations
The fall in the price of the bitcoin below $60,000 came as euphoria about the first cryptocurrency ETF in the United States faded and speculators took gains after a record-breaking rise. The most valuable digital asset by market capitalization plummeted around 6 percent, achieving its lowest intraday price in over a few weeks. On October 20, it reached a high of $66,976. Ether fell nearly 6% as well, while smaller tokens fell more than 7%, with Dogecoin and Solana also falling more over 7%. At one point, the Bloomberg Galaxy Crypto Index, which monitors some of the largest digital coins, plunged 7.5 percent.
“Given the rapidity of the advance from $30,000 in July, I’m not surprised Bitcoin struck a wall around $67,000, having eclipsed the April high,” said AntoniTrenchev, managing partner and co-founder of Nexo, a crypto lender. “Bitcoin should take a break before continuing on its upward trend..”
Many smaller “alt” currencies were struck the hardest: Cardano lost 9% in the previous 24 hours while Polkadot lost 5%, according to Coinmarketcap.com.
“They’ve always been more volatile,” Matt Maley, chief market strategist at Miller Tabak& Co., explained. “Those coins are in the hands of low-level people.”Because most people feel that only a small number of these altcoins will survive, they tend to sell them more quickly than Bitcoin or Ethereum.”
Mr Schmitt says that the speculators are reducing their positions after the introduction of the first Bitcoin exchange-traded fund in the United States fueled euphoria and pushed prices to new all-time highs, according to experts. According to statistics from Bybt.com, total liquidations of long crypto holdings surpassed $700 million on Wednesday, the largest since Sept. 20.
According to Stephane Ouellette, CEO and co-founder of FRNT Financial Inc., a crypto-focused capital-markets platform, some of the euphoria surrounding the ETFs has faded, and the sell-off has been exacerbated by the fact that there is significantly more leverage available in crypto for retail traders globally than in other asset classes.
“We’ve already seen a wave of extreme leverage enter the business, as seen by futures contangos, perpetual swap rates, and peer-to-peer lending rates all skyrocketing around the introduction of the BTC ETF.,” Ouellette added. “For example, in recent weeks, we’ve witnessed monthly and quarterly BTC futures contangos in the 20-to-30% range.” While leverage may go considerably higher in some cases, the current behaviour shows some tell-tale signs of a conventional crypto check-back.”
Ouellette noted December BTC futures contango on the FTX cryptocurrency derivatives platform lowering overnight to 13.5 percent from approximately 20 percent annually. When futures trade at a premium to spot prices, this is referred to as contango.
Bitcoin also went below its 20-day moving average, a technical move that might lead to more selling. Meanwhile, Nexo’sTrenchev believes there is a distinct “head-and-shoulders” pattern in place, with $60,000 being a critical threshold.
“Bitcoin has dropped below that threshold, to $58,000.,” he added. “Let’s see if it recovers.” Otherwise, consider $52k or $53k as feasible destinations.”
Bitcoin broke past $60,000, breaking through its prior resistance-turned-support level; its recent run lower suggests it may find support at its 50-day moving average of roughly $51,555. Furthermore, its recent sell-off has taken its 14-day relative strength index (RSI) from overbought to practically neutral levels.
The ProSharesBitcoin Strategy ETF, or ticker BITO, has amassed more than $1 billion in assets in only a few days after its debut last week. For crypto enthusiasts, their debuts were a watershed event since they signalled increased popular acceptability and allowed investors to invest in an investment instrument that was previously unavailable to a larger group of people.
“The price collapse is being pushed by sellers, who appear to be acting concurrently in withdrawing gains on their investment,” said PetrKozyakov, co-founder and CEO of global payments network Mercuryo. “The price adjustment is organic and was not precipitated by a clear fundamental.”
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