Why did Bitcoin price fall?
It was another quiet week in the cryptocurrency market.
On Wednesday, January 10th, the Securities and Exchange Commission (SEC) approved applications for 11 spot Bitcoin ETFs. The next day, Bitcoin’s value fell, continuing to fall by more than 12% (since its two-year high of $48,600).
Buy rumors, sell news.
If you are not familiar with the proverb “Buy on the rumor, sell on the news” An expression commonly used in trading to indicate trends in securities. Prices rise due to anticipation of the event (rumor). after that Autumn after the actual incident (news).
Bitcoin price fell following the SEC’s recent announcement of approval of a spot Bitcoin ETF. textbook example Buy rumors and sell news This is a well-known phenomenon that is mainly driven by market psychology and the speculative nature of traders.
Let’s break this down and tie it to the recent Bitcoin price decline associated with the Spot Bitcoin ETF.
buy the rumor
- anticipation stage: In the context of Bitcoin and spot Bitcoin ETFs, “rumor” is market speculation or expectation that a spot Bitcoin ETF will be approved. The market perceives this approval as a bullish signal, potentially making Bitcoin more accessible to a wider range of investors and thus increasing demand.
- price inflation: Once this decision was made, traders and investors started buying Bitcoin and the price rose. This purchase was not based on the event itself (ETF approval), but on speculation or ‘rumors’ that the event would have a positive effect on the price of Bitcoin.
news sales
- event occurs: When an actual event occurs – in this case, the SEC’s approval of the Spot Bitcoin ETF. Once the market receives concrete information, the news disappears and speculative factors no longer come into play.
- Take Profit: People who bought Bitcoin on a speculative basis may start selling their holdings to realize profits. This is especially true if the news meets but does not exceed market expectations. The thinking here is that the bullish rally may not last much longer because the expected event has occurred and now is a good time to cash out the profits.
- price correction: This selling pressure could lead to a decline in the price of Bitcoin. The decline is not necessarily because the news is bad, but because the market is rebalancing after a speculative rally (the news has had an effect on the Bitcoin market price). The new price is finding an equilibrium where speculative buying is replaced by more fundamental, long-term investment decisions.
In any case, “buy on the rumor, sell on the news” is a pattern observed in many markets, but it is important to approach each situation with a comprehensive analysis, taking into account all market dynamics, rather than simply speculating.
We could see the Bitcoin price drop below $40,000 before correcting again to give us an opportunity to get into the market before the price rises again.
With the Bitcoin halving event just around the corner, it is not too late to enter the market.
Bitcoin Halving Event:
There are less than 95 days left until the next Bitcoin halving event. The catalyst for every bull market!
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Join us – as we build up.
Although prices are still relatively low, now is a great time to enter the market. If you want to know what we’re buying, join us as we share our monthly Altcoin recommendations in anticipation of the upcoming bull market. All you have to do is become a member.
Richard.
Top 100 popular altcoins:
There was a significant deficit in the cryptocurrency market (last 7 days).
Today’s Crypto Fear and Greed Index:
today’s Cryptocurrency Fear and Greed Index = avarice –> Decrease to 56 (from 64 last week).
Bitcoin and Ethereum price changes
Bitcoin Diminish 3.0% Here are the prices it is currently trading at last week: $41,663. Over the past 90 days, Bitcoin has increased by: 34.2%.
Ethereum Diminish 2.2% Here are the prices it is currently trading at last week: $2,474. Over the past 90 days, Ethereum has increased by: 46.9%.
Global cryptocurrency market capitalization increased to $1.64T (From $1.68T last week).
Top 100 Gainers – Last 7 Days
The biggest gainers over the past 7 days (in the top 100) are:
Ronin (RON) +36.8% – 90th
Ronin (RON) It is the native cryptocurrency of the Ronin blockchain, a sidechain created primarily for the Axie Infinity game to solve problems such as scalability and high transaction fees on the Ethereum network. The Ronin blockchain is designed for gaming, offering low transaction fees and high transaction throughput. RON is used for transaction fees, governance, and potential staking within the network, with the goal of ensuring security and decentralization through a proof-of-authority consensus mechanism. Although initially focused on Axie Infinity, the Ronin blockchain aims to support a wider range of applications, potentially enhancing the usability and value of RON.
ASTR (ASTR) +28.1% – 63rd
ASTR It is the native cryptocurrency of Astar Network, a multi-chain smart contract platform in the Polkadot ecosystem designed to be a hub for decentralized applications (dApps). Support for multiple virtual machines such as EVM and WASM enables creation of dApps with smart contract functionality in various programming languages. Astar’s interoperability based on Polkadot enables seamless cross-chain transfers and interactions. Astar’s unique feature is dApp staking, which allows users to support dApps they sponsor and earn rewards. ASTR tokens facilitate transaction payments, governance participation, and staking within the network. Aimed at advancing the DeFi and Web3 spaces, Astar provides scalable and developer-friendly infrastructure.
Flare (FLR) +27.1% – 85th
Flare (FLR) It is the native token of Flare Network, a blockchain project that aims to introduce smart contract functionality to cryptocurrencies that do not natively support it, such as XRP. The network is designed for high scalability and speed, improving transaction throughput. FLR is used within DeFi applications for transaction fees, governance, and networks. Flare’s key feature is interoperability, which allows it to integrate with multiple blockchain networks and extend its utility. Flare is also introducing F-Assets, which represent non-smart contract tokens, allowing them to be used in smart contracts on the Flare network. The project gained attention with its Spark token airdrop to XRP holders. Flare seeks to enrich the blockchain ecosystem by improving functionality and interoperability.
Siacoin (SC) +22.4% – 87th
Siacoin (SC) is the cryptocurrency of the Sia network, a decentralized cloud storage platform that provides a secure, private, and cost-effective alternative to traditional cloud services. The network allows users to rent unused hard drive space or buy storage, and blockchain can be used to create a trustless storage marketplace. Siacoin rewards hosts for facilitating transactions and providing storage space on the network. The Sia network prioritizes privacy and security through encryption and decentralization, ensuring that only those who own the data have access to their files. Leverage smart contracts to enforce storage contracts and maintain file redundancy to ensure data availability.
Biggest microcap gain in the last 30 days
We review and analyze small and micro market cap cryptocurrencies every week to find the next low-cap gem. The best performing (quality) microcap projects over the last 30 days are:
Top performing quality microcaps (last 30 days):
Monthly altcoin selection:
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Until next report,
Richard.