Bitcoin (BTC) experienced a drop below $28,000 on Tuesday, shortly after surpassing this level earlier in the week. This decline was primarily due to investors taking profits and some changes in the on-chain data, which made it difficult for the price to continue its upward trend.
On Tuesday afternoon in Asia, BTC was trading at slightly above $27,600. Over the past 24 hours, Ether (ETH) also saw a 3.5% decrease in its price, coinciding with the less-than-stellar debut of ETH futures ETF trading in the United States. Additionally, XRP and BNB Chain’s BNB token both experienced a 2.7% decline, while dogecoin (DOGE) and Tron network’s TRX dropped by as much as 4%.
Rollbit’s RLB tokens had an impressive 8% increase, marking several days of gains due to rising demand for the tokens and increased profits on the platform.
On the other hand, the CoinDesk Market Index (CMI), which measures the performance of many tokens, dropped by 3%, suggesting that many investors were cashing in on their gains.
The cryptocurrency market saw an uptick in activity on Monday, driven by optimism about the potential for ETFs (Exchange-Traded Funds) to attract new interest and investment. Some traders were also looking at historical trends in October, a month known for price surges, hoping for a repeat of this phenomenon. However, it’s important to remember that these expectations don’t always pan out as planned.
Lucas Kiely, the Chief Investment Officer of Yield App, mentioned that October traditionally tends to be a positive month for cryptocurrencies, often referred to as “uptober” by insiders. He pointed out that since 2013, Bitcoin has only closed October at a loss twice, and many are hopeful that this year will follow that trend.
However, it might be a bit premature to get overly excited about these recent price movements. We can’t be sure that this is the start of a significant rally unless there are other factors driving it,” warned Keily. He also noted that the ongoing trial of Sam Bankman-Fried could impact the crypto markets depending on any new information that emerges.
On another note, analysts from Bitfinex Markets pointed out in their weekly report that long-term investors were still increasing their holdings, which was contributing to higher demand.
They mentioned, “The on-chain activity for Bitcoin has reached all-time highs in terms of new addresses. What’s noteworthy is that this activity mostly involves short-term holders selling, allowing the supply held by long-term investors to keep growing.”
In addition, they expressed the opinion that cryptocurrency markets might see a return of volatility in the near future, possibly on the upside.
