Bitcoin Price Falls as Traders Desire to Make Profit

CoinDesk 20 Index: 2,691.86 +0.76%

Bitcoin (BTC): $90,386.53 -1.21%

Ether (ETH): $3,107.30 -2.48%

S&P 500: 5,949.17 -0.6%

Gold: $2,568.54 +0.01%

Nikkei 225: 38,642.91 +0.28%

As Bitcoin (BTC) price struggles to gain ground above $90,000, cryptocurrency-related developments in the options market listed on Deribit are reminiscent of patterns that heralded the recent price decline in Trump media stocks. Hawkish comments from Fed officials support the case for a price pullback suggested by the implied volatility distribution. Chairman Jerome Powell said yesterday that the economy is not giving any signals that we should rush to lower interest rates. The Fed, which has reduced the interest rate by 75 basis points since September, was giving bullish signals for risk assets. However, most market participants continue to place bets beyond the $100,000 barrier.

U.S.-traded bitcoin (BTC) exchange-traded funds (ETFs) experienced their third-largest outflow since launch, recording a total outflow of $400.7 million yesterday. Bitcoin, which hit an all-time high of over $93,000 on November 13, corrected nearly 6% in just a few days. However, traders and investors do not think that the price movement is alarming because investors generally tend to try to take profits when bitcoin makes a new high. According to Glassnode data, investors made a total of $15 billion in sales in the last three days. Bitcoin has gained over 25% since Donald Trump was elected US president on November 5.

XRP has surged 17% in the past 24 hours, outpacing gains in bitcoin (BTC) and major stocks as a changing US regulatory environment fuels growth in the tokens previously hampered by Securities and Exchange Commission (SEC) actions. XRP traded above 82 cents earlier in the day, reaching levels last seen in June 2023, extending its 7-day gain to 50%. The move comes as 18 US states have filed to sue the SEC and its commissioners, including Gary Gensler. The accusations are that the commissioners are unconstitutionally trying to go beyond their authority against the crypto industry. Speculative optimism among investors is that a crypto-friendly Trump administration could benefit tokens linked to US-based companies such as Ripple Labs (XRP) and Uniswap (UNI).

BTC has recently recovered with support from the rising 100 hourly moving average (SMA), and a positive crossover has formed again on the hourly MACD histogram. This indicates that prices may soon test the uptrend line resistance. If BTC manages to break this resistance, it can rise above $94,000. We could see new highs. On the other hand, if the price breaks below the 100-hour SMA support, a deeper pullback could be seen towards the 200-hour SMA at $82,600. Source: TradingView