Bitcoin bounce fades as it drops back down to just under $67,000

Core Viewpoint - Bitcoin has experienced significant volatility, with its price dropping from an all-time high of over $126,000 in October to around $66,737, representing a decline of approximately 47% from its peak [1][2]. Price Movement - Bitcoin was trading at approximately $66,737 as of Thursday morning, having fluctuated between $66,000 and $72,000 recently [1][2]. - The cryptocurrency fell below $70,000 on February 5 and has since struggled to regain higher levels, currently holding just above $60,000, which is considered a critical support level [1][2]. Market Influences - The decline in Bitcoin's price has been influenced by volatility in U.S. technology stocks, with which crypto assets often correlate [2]. - A sell-off on February 5 was triggered by a wave of liquidations, forcing traders to close positions, which exacerbated the downward pressure on Bitcoin [3]. ETF Dynamics - Selling from Bitcoin exchange-traded funds (ETFs), which are significant holders of Bitcoin, contributed to outflows and added pressure on the cryptocurrency [5]. - However, in the last three days, Bitcoin ETFs have recorded net inflows, indicating a potential shift in market sentiment [6]. Bitcoin Cycle Analysis - Market participants are assessing whether Bitcoin's historical cycle, particularly following the halving event, remains intact. This cycle typically leads to new all-time highs followed by corrections [7][8]. - The most recent halving occurred in April 2024, which reduces mining rewards and slows Bitcoin supply, often preceding price rallies [8]. Future Predictions - Analysts suggest that the typical Bitcoin cycle is still valid, with expectations of potential price declines to around $50,000 in the summer before a possible recovery in the fall [10].