Bitcoin price fell, erasing the previous day’s gains but staying within the support of around $40,000

Bitcoin price fell today, wiping out the previous day’s gains but remaining within a few weeks’ trading range of around $40,000 to $44,000. At the time of writing, BTC is changing hands at $42,584.

bitcoin-price-fell-erasing-the-previous-days-gains-but-staying-within-the-support-of-around-40000

BTC/USD 4-hour chart | Source: TradingView

Bitcoin price slid in tandem with tech stocks

Market news includes a potential ban on crypto use in Pakistan and signs that Bitcoin miners are increasing their crypto accumulation, seemingly refusing to sell with the current price.

Several prominent Wall Street commodity analysts say that Bitcoin is likely to outperform the major raw materials of oil and copper over the next decade.

However, to do that, Bitcoin is forced to break out more than it is now. As it is still being driven by a slide in technology stocks, with the Nasdaq 100’s sudden swing to jolt investors are worried that the Federal Reserve will start raising interest rates for the first time since 2018 within the next few months.

A tightening of monetary conditions by the Federal Reserve (Fed) could put downward pressure on prices for risky assets, from stocks to cryptocurrencies, while also curbing inflation – potentially reducing the appeal of Bitcoin, which many investors have bought as a hedge against inflation, which is rising at its fastest pace in nearly four decades. Is that a bullish sign or bearish? Time may tell.

“The Bitcoin bears were out at 6-month high levels earlier this week, and this skepticism appears to be a main driver of the mild bounce, for now. Commentary has turned a bit more positive for BTC and ETH, but there is still a notable amount of FUD”, Santiment stated.

bitcoin-price-fell-erasing-the-previous-days-gains-but-staying-within-the-support-of-around-40000

Source: Santiment

Bitcoin pulled back after buyers took some profits near the $44,000-$45,000 resistance zone. The cryptocurrency remains in a short-term downtrend, although support at around $40,000 could stabilize the pullback.

BTC is down about 2% over the past 24 hours and is roughly flat over the past week. A decisive break above $45,000 is needed to reverse the short-term downtrend, but slowing momentum suggests price weakness could persist into the Asia trading day.

The Relative Strength Index (RSI) on the four-hour chart declined near overbought levels, similar to what occurred in late December, which preceded a pullback in price. Buyers will likely remain on the sidelines until oversold conditions materialize, most likely over the next few days.

The overall cryptocurrency market cap stands at $2.027 trillion, and Bitcoin Dominance is 39.7%.

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