Bitcoin Holds Near Key Levels Amidst Selling Pressure

Bitcoin and other cryptocurrencies experienced a slight decline on Thursday, remaining close to crucial levels as a "sell the news" trend continued following the approval of spot Bitcoin exchange-traded funds. There is a possibility of further selling in the near future.

Over the past 24 hours, the price of Bitcoin dropped by less than 1% and fell below the $39,800 mark. Although it dipped below the psychologically significant $40,000 threshold, it managed to stay above recent lows in the $38,000 range. Despite this, the leading digital asset is still more than 15% lower than its peak of over $48,000, reached during the trading frenzy surrounding the anticipation and eventual approval of spot Bitcoin ETFs in the United States.

Earlier this week, the optimism surrounding risk-sensitive assets and the stock market rally, with the Dow Jones Industrial Average and S&P 500 trading near their all-time highs, boosted cryptocurrencies. However, these gains were not sustained. Currently, Bitcoin is hovering around the pivotal $40,000 level. Although recent price movements have been negative, there is a sense of stability in the short term. However, this stability may not last long.

According to Alex Kuptsikevich, an analyst at broker FxPro, Bitcoin has shown a cautious upward trend since Tuesday. Some traders are aiming to secure profits from short positions or buy after a sharp sell-off. It is worth noting that Bitcoin did not become oversold before stabilizing, and bears may be taking advantage of the current lull to accumulate liquidity before initiating another sell-off.

Apart from Bitcoin, Ether, the second-largest cryptocurrency, experienced a 1% drop to reach $2,200. Smaller tokens or altcoins showed less movement. Cardano was slightly above flat, while Polygon was just below it. Among memecoins, Dogecoin saw a 2% decrease, whereas Shiba Inu advanced by more than 1%.

In conclusion, Bitcoin's recent performance has been impacted by the approval of spot Bitcoin exchange-traded funds, leading to a "sell the news" dynamic. Although it is currently holding near key levels, a potential further decline looms. Traders are cautiously observing the market, taking profits and preparing for future volatility.