Bitcoin
and other cryptocurrencies slipped back on Monday, with recent highs for digital assets proving hard to hold, though analysts and traders expect the momentum behind gains to continue.
The price of Bitcoin fell 1% over the past 24 hours to $37,250, with the largest digital asset retreating further from its recent peak above $38,000—the highest level for Bitcoin since cryptos plunged into a brutal bear market in May 2022. Bitcoin remains up by more than one-third since early October, amid a rally that has snapped cryptos out of a multi-month stretch of subdued trading and spurred calls of a new bull market.
“Failure to build on the growth at the end of last week caused moderate pressure on prices,” said Alex Kuptsikevich, an analyst at broker FxPro.
Multiple factors continue to support gains for Bitcoin including optimism that U.S. regulators will soon approve the first spot Bitcoin exchange-traded fund (ETF), which is widely expected to usher in a fresh wave of investor interest in digital assets.
The macroeconomic backdrop, which has similarly buoyed the stock market’s
Dow Jones Industrial Average
and
S&P 500,
is also supportive. Traders expect the Federal Reserve to not raise interest rates any further and cut borrowing costs perhaps four times next year—a monetary policy shift that should boost risk-sensitive bets such as tech stocks and tokens.
Crypto traders remain bullish, with the funding rate in Bitcoin derivatives markets remaining in positive territory—a signal that the majority of wagers call for a continued increase in prices. Analysts are also eyeing a strong technical backdrop.
“With the lower boundary now at $36,600 and the upper boundary at $38,300…only a decline below the lower boundary will question the sustainability of the uptrend,” said Kuptsikevich. “Until then, the prevalence of buying on declines in [Bitcoin] is very likely.”
Beyond Bitcoin,
Ether
—the second-largest token—lost 2.5% to below $2,050. Smaller cryptos or altcoins were also lower, with
Cardano
down 3% and
Polygon
slipping 4%. Memecoins were more buoyant, with
Dogecoin
up 2% and
Shiba Inu
less than 1% higher.
Write to Jack Denton at jack.denton@barrons.com
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