The price of Bitcoin has fallen by 1% in the past 24 hours, dropping to $37,250. This comes after the cryptocurrency retreated from its recent peak above $38,000, which marked its highest level since the brutal bear market in May 2022. Despite the setback, Bitcoin remains up by over one-third since October, representing a significant rally that has brought cryptocurrencies out of a subdued trading period and signaled the start of a new bull market.
Analysts and traders have identified several factors that continue to support gains for Bitcoin. One primary factor is the anticipation that U.S. regulators will soon approve the first spot Bitcoin exchange-traded fund (ETF), which is expected to generate a wave of investor interest in digital assets. Additionally, the overall macroeconomic climate, which has been favoring the stock market, contributes to Bitcoin’s positive trajectory. Traders predict that the Federal Reserve will maintain low interest rates and potentially cut borrowing costs four times next year. This expected monetary policy shift should boost risk-sensitive investments like tech stocks and tokens.
The prevailing sentiment among crypto traders remains bullish, as evidenced by the positive funding rate in Bitcoin derivatives markets. This indicates that the majority of wagers anticipate a continued increase in prices. Analysts also point to a strong technical backdrop as further evidence of Bitcoin’s upward momentum.
Moving beyond Bitcoin, other cryptocurrencies also experienced a setback. Ether, the second-largest token, saw a 2.5% decrease, dropping below $2,050. Altcoins such as Cardano and Polygon also saw declines of 3% and 4%, respectively. In contrast, memecoins like Dogecoin enjoyed slight gains, with a 2% increase, while Shiba Inu saw a marginal rise of less than 1%.
In conclusion, although Bitcoin and other cryptocurrencies have faced recent setbacks, experts anticipate that the positive momentum behind their gains will continue. Factors such as the potential approval of a Bitcoin ETF and the supportive macroeconomic climate contribute to this optimistic outlook.
