The price of Bitcoin (BTC) fell as investors cashed in their gains after the cryptocurrency’s value rebounded. Over the past 24 hours, the BTC has lost 6.16% and is changing hands at $98,548 at the time of writing, as the market sentiment changed after several weeks of growth.
According to a recent report, this comes only days after President Donald Trump penned an executive order to ensure the United States’ dominant position in the blockchain industry. The order also set up a working group to recommend a framework for regulating digital asset within the next six months. It also ordered the group to assess the potential of forming a national crypto wallet, but did not confirm such an action.
Other altcoins such as Solana and Cardano were also affected and dropped by more than 5%, as revealed by Bloomberg data. Both assets had recorded stunning gains following Trump’s win in November but the losses observed on Monday indicate that the market may be correcting the earlier’s gains enthusiasm.
Bitcoin Faces Pressure
Despite the executive order being viewed as a good move for the industry, some investors were shocked. Market participants had expected more instructions, for example, creating a Bitcoin reserve directly. Sean McNulty, head of APAC derivatives at FalconX, added that perhaps the lack of this measure led to the pullback. He stated: Anything short of a Bitcoin reserve that immediately started buying BTC was going to disappoint.
Even though the market got 90 per cent of what it wanted with the executive orders, it evidently was mostly priced in.
One of the most notable changes in the cryptocurrency industry has been the change in Trump’s attitude towards cryptocurrencies. He was an opponent of cryptocurrency but became an advocate during the campaign period, thanks to the lobbying power of the crypto industry. Large contributions from the blockchain industry also contributed to his change of heart, as did the sector’s growing relevance to advancements in technology.
Since Trump’s election win, Bitcoin has risen by more than 50%, but the recent dip shows it may have lost some steam. Citi analysts pointed to profit-taking as well as technical bearishness as reasons for the current selloff. Bitcoin may come under more selling pressure should some specific patterns on the price chart occur.
Bitcoin’s Critical Levels
The traders are, however, concerned with the formation of a double-top pattern, which is a bearish sign. The bearish pattern, which is characterized by a situation where an asset fails to penetrate the previous highs and declines afterward, is a form of a reversal signal.
Bitcoin is currently trading with a bearish pattern, and its neckline support is at $91,300; a close below this level may lead to further decline. If this occurs, BTC may decline to $75,000 or even lower, given that the pattern’s structure was used as a basis for the estimates.
Despite the short-term volatility, many in the industry view Trump’s executive order as a crucial milestone for the digital asset space. This is anticipated to bring about much-needed direction, given efforts being made to set up a regulatory framework and encourage public-private partnerships. This is something of a positive for institutional investors, who have thus far been relatively hesitant owing to the lack of clear guidance from the regulators.
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Also important is Trump’s overall focus on the US as a leader in blockchain technology as he has recently stated. The appointment of David Sacks, a venture capitalist, as the administration’s crypto and artificial intelligence czar, also means that emerging technology will remain a key part of DeSantis’s policy agenda.
Although often considered a rather provocative marketing move, the recent launch of meme coins by the president, in collaboration with the former First Lady Melania Trump, points to the administration’s support for digital assets.
Bitcoin holding above important levels like $91,300 in the upcoming weeks is going to be important. The move below this level may lead to further declines, whereas the recovery may help regain the market participants’ trust.
Conclusion
The next few months are likely to be critical because the United States will start to act on the working group’s proposal. The market remains in the process of grappling with the effects of Trump’s executive order. While the initial response has been rather lukewarm, most observers expect it to pave the way for further digital asset development. The future of digital currency will also be determined by policies that are being set to shape the future of the industry in this critical period.
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FAQs
Why did Bitcoin experience a sudden price drop?
Investors cashed in on profits after weeks of steady growth, leading to a 5.74% drop in Bitcoin’s value.
What role did Trump’s executive order play in the market reaction?
While the order highlighted blockchain innovation, the lack of a Bitcoin reserve dampened investor expectations.
Did Bitcoin’s decline impact other cryptocurrencies?
Altcoins like Solana and Cardano mirrored Bitcoin’s losses, falling over 5% as market enthusiasm cooled.
What could happen to Bitcoin’s price in the near future?
If Bitcoin drops below $91,300, its price may face further declines, with $75,000 as a possible target.
The price predictions and financial analysis presented on this website are for informational purposes only and do not constitute financial, investment, or trading advice. While we strive to provide accurate and up-to-date information, the volatile nature of cryptocurrency markets means that prices can fluctuate significantly and unpredictably.
You should conduct your own research and consult with a qualified financial advisor before making any investment decisions. The Bit Journal does not guarantee the accuracy, completeness, or reliability of any information provided in the price predictions, and we will not be held liable for any losses incurred as a result of relying on this information.
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