Bitcoin Price Plunged to $31k, a 15% Contraction
The BTC/USD price on Jan 11 fell to as low as $31k, compounding losses that started in the Asian session, continuing for the better part of the day. Despite the contraction, BTC bulls are optimistic, expecting prices to bounce back to over $40k, citing historical price action and the strong fundamentals. Preceding this selloff were miners who have been liquidating their holdings for 12 straight weeks. It also coincides with the projected recovery of the US economy, an improving job market, and rising bond yields, factors that may cause investors to move their capital from a risky and untested asset towards safe and regulated financial instruments.
Following yesterday's losses, the BTC price slid 15 percent, shedding over $10k; the steepest since the flash crash of mid-March when prices plunged to below $4k before recovering ahead of the Bitcoin halving and rising to spot rates, nine months later. Most punters opine that the near perpendicular rally could be over. As the crypto market remains hot, the cool-off is, therefore, inevitable. Considering the depth and level of participation accompanying yesterday's free-fall, the BTC/USD price could shrink in a correction.
Impact on the BTC Price:
Bearish. After nine months of steady gains, the digital gold's rapid price depreciation could end up mirroring those of the gold and plunge in a correction. Regardless of market participants' expectations, a correction looks likely, and a contrarian could be panning out as of writing.
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