Bitcoin drops to three months low

Bitcoin seems to be on sale today, dropping to the lowest $42,645 since past 3-months. The cryptocurrency hit record highs at the start of 2021 before dropping in May following regulatory crackdowns in countries such as China and India and it has started 2022 on a downward trend.

A look under the hood helps explain why: Trading volumes have dried up, futures open interest is plunging and the number of active addresses has stalled out. The value of Bitcoin is determined by how much people are willing to exchange it for and its price has fluctuated wildly since its launch.

It’s currently valued at around $43,080 – down by more than 7% over the past 24 hours, according to CoinMarketCap. That is a long way down from last year when the currency had hit record highs of more than $67,000, helped by El Salvador making Bitcoin legal tender and regulatory approval of a Bitcoin futures ETF in the US.

Since then, it has seen regular slumps – eventually dropping to its current price. There is no clear reason for Bitcoin’s latest drop, underlining how volatile and unpredictable the cryptocurrency is.

Unlike BTC, ether (ETH-USD) manages to hold above its 200-day simple moving average (on a 52-week time frame) at ~$3.2K per token. Bitcoin (BTC-USD) is trading more than 7% below its 200-day SMA, now changing hands at $43K. Note that both BTC and ETH dipped to as low as Sep. 30 levels.

Some analysts claim the cryptocurrency market is following the direction of shares, with stock markets dropping in the US this week amid fears that the Federal Reserve will withdraw its economic monetary support and hike interest rates.

Source: The Sun

Original link: Your go to Crypto place