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Bitcoin Snaps 6-Day Losing Streak, Holds Above $40K
The price appears to have stabilized after a nearly weeklong downdraft that marked one of the cryptocurrency’s worst-ever starts to a year.
Bitcoin’s price rose on Sunday, after it snapped a six-day losing streak and avoided a drop below the key psychological level of $40,000 that some cryptocurrency analysts had warned might trigger a steeper sell-off.
As of press time, bitcoin (BTC) was changing hands at around $42,100, up 2% over the past 24 hours, based on CoinDesk pricing. The cryptocurrency had been on the verge of a seven-day losing streak that would have been its longest since 2018, but the price turned around on Saturday, eking out a small gain, and has stayed on an upward trajectory since.
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The price hadn’t fallen below $40,000 since September, and is well off its all-time high of nearly $69,000 reached in November, and so there had been speculation that a drop below $40,000 might spur a deeper retrenchment.
“If the market has based at these levels, we might get that short squeeze we’ve been waiting so patiently for,” Singapore-based crypto trading firm QCP Capital wrote Sunday on its Telegram channel.
January tends to be a seasonally weak month for bitcoin, but this year has been especially harsh, with the largest cryptocurrency by market cap still down 9% so far in 2022.
The market was roiled last week by the release of Federal Reserve minutes signaling that officials at the U.S. central bank were starting to discuss whether to take more aggressive steps to tackle an inflation rate now at its highest in almost four decades.
Many investors say bitcoin has benefited in recent years from the Fed’s ultra-loose, emergency monetary policy since the coronavirus hit the economy – including printing more than $4 trillion to bolster ailing traditional markets.
So a reversal of those policies was seen as a fresh headwind for bitcoin.
Bradley Keoun
Bradley Keoun is CoinDesk's managing editor of tech & protocols, where he oversees a team of reporters covering blockchain technology, and previously ran the global crypto markets team. A two-time Loeb Awards finalist, he previously was chief global finance and economic correspondent for TheStreet and before that worked as an editor and reporter for Bloomberg News in New York and Mexico City, reporting on Wall Street, emerging markets and the energy industry. He started out as a police-beat reporter for the Gainesville Sun in Florida and later worked as a general-assignment reporter for the Chicago Tribune. Originally from Fort Wayne, Indiana, he double-majored in electrical engineering and classical studies as an undergraduate at Duke University and later obtained a master's in journalism from the University of Florida. He is currently based in Austin, Texas, and in his spare time plays guitar, sings in a choir and hikes in the Texas Hill Country. He owns less than $1,000 each of several cryptocurrencies.
