(Bloomberg) — Bitcoin’s decline from its all-time high earlier this week widened by more than 10% as speculative fever waned as less room for monetary easing in the United States.
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The price of the original cryptocurrency fell to $95,234 at 9 a.m. in London on Friday, after hitting an all-time high of just over $108,000 earlier in the week. The economic downturn weighed more heavily on smaller tokens like Ether and Dogecoin.
On Thursday, a group of U.S. exchange-traded funds that invest directly in Bitcoin stopped inflows for 15 consecutive days, posting record outflows of $680 million, according to data compiled by Bloomberg. recorded and highlighted changes in sentiment.
Strahinja Savic, head of data and analysis at FRNT Financial, said it is “quite typical” to see such corrections in crypto bull markets, while QCP Capital said in a note that He said the root cause of this was “overly bullish” market positioning.
The Fed's hawkish policy shift on Wednesday weighed on most risk assets. Bitcoin remains up nearly 50% since crypto advocate Donald Trump won the November 5 US presidential election.
“This seems like a year-end profit-taking move,” said Edward Chin of Parataxis. “There were no fundamental factors that caused the decline.”
With the Fed expected to cut interest rates less in 2025, some investors may choose to reduce their exposure and take profits.
“Technically, caution is warranted in the short term,” Chris Weston, head of research at Pepperstone Group, wrote in a note. “This doesn't mean we're going to see a price collapse any time soon, but there's clearly momentum coming out of this move and buyers are losing power and control of the tape.”
–With assistance from Olga Khalif.
(Update price.)
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