Bitcoin Price Down Today: Bitcoin Price, Bitcoin News Today, Bitcoin Share Price

Bitcoin has remained above $40,000 for the past several days, but a drop early Thursday afternoon put it on track to break its all-time high of $30,000 for the first time since February 4.

Bitcoin was never above $40,000 since January 20. Since January 24, the price has been below $34,000 for the first time since July 2021.

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Despite its recent rebound, Bitcoin’s stalling price in recent weeks was preceded by a statement from Federal Reserve Chairman Jerome Powell that the Fed will begin raising interest rates at its next meeting in March to combat rising prices. January’s massive drop in Bitcoin โ€” the same occurred to Ethereum โ€” occurred amid the stock market’s worst month since March 2020, and after the release of the Federal Reserve’s long-awaited study on a government-issued digital currency.

Bitcoin Price Down Today: Bitcoin Price, Bitcoin News Today, Bitcoin Share Price
Bitcoin Price Down Today: Bitcoin Price, Bitcoin News Today, Bitcoin Share Price

Grant Maddox, a South Carolina-based certified financial planner, says investors are taking a fresh look at their portfolios as a result of the recent market volatility. โ€œMany investors are reducing risk from their portfolios right now, which could be the first sign of a new market cycle,โ€ said Maddox to us recently.

This week, Bitcoin’s price ranged from $41,000 to $45,000. Here’s how Bitcoin’s current price compares to its daily high point over the last several months:

The price drops are being driven by rising inflation, a disappointing December employment report, and continuing indications from the Fed that it will begin reducing extraordinary measures to aid the economy this year.

Despite the fact that Bitcoin nearly reached $52,000 on Dec. 27, it has fluctuated between $33,000 and $50,000 in the days since.

Despite the recent downturn, Bitcoin has started 2022 on a relative high note, with a strong November and early December that gave way to the current downward trend. Bitcoin began 2021 at $30,000 and increased throughout the year, reaching an all-time high of $68,000 on Nov. 10.

With new economic uncertainty over the Omicron COVID-19 variant, fresh statements from Federal Reserve Chairman Jerome Powell on the economy’s health, and continuing remarks from U.S. officials like SEC Chairman Gary Gensler on cryptocurrency regulation, volatility and price stagnation continue apace.

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Despite a significant decline from its all-time highs, many experts believe that Bitcoin’s price will rise above $100,000 at some point – describing it as a question of when, not if. Shortly after topping out at $7,828 per BTC on December 18th โ€” Ethereum recorded its own new all-time high when its value topped at $4850.

Bitcoin Price Down Today: Bitcoin Price, Bitcoin News Today, Bitcoin Share Price 3

 

โ€œYou have a good chance of losing everything, but a small possibility of gaining big,โ€ according to Nate Nieri, a CFP with Modern Money Management in San Diego, California. If you lost everything, he advises not to gamble an amount that would put your family into debt or prevent you from achieving your objectives.

What, if anything, does this most recent market crash say about the stock market as a whole, or even ordinary stock market downturns โ€” and what does it imply for investors?

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For those who invest in cryptocurrencies for the long term using a buy-and-hold approach, swings like this are to be expected. According to Humphrey Yang, personal finance expert behind Humphrey Talks, big dips aren’t anything to be overly concerned about since he avoids checking his own investments during volatile market downturns.

Bitcoin Price Down Today: Bitcoin Price, Bitcoin News Today, Bitcoin Share Price

โ€œI’ve been through the same thing as you,โ€ Yang adds. โ€œI understand that these things are extremely volatile, with some days seeing declines of 80 percent or more.โ€

Experts recommend keeping cryptocurrency investments to less than 5% of your overall portfolio. If you’ve done that, don’t worry about the fluctuations because they’ll continue to happen, according to Bill Noble, chief technical analyst at Token Metrics, a cryptocurrency analytics firm.

โ€œVolatility is as old as the hills, and it isn’t going anywhere,โ€ Noble points out. โ€œIt’s something you have to live with.โ€

Yang says you don’t have to sell your crypto investments unless they’re getting in the way of your other financial goals. Set it and forget it, he advises.

If this kind of tremendous collapse worries you, your crypto investments might be too risky. You should only invest what you are ready to lose. However, even if the fall has made you reconsider your cryptocurrency investments, the same advice applies: Don’t act hastily or change your approach too rapidly. Consider how you may adjust your strategy to better fit your new circumstances, such as lowering future crypto allocations or diversifying through crypto-related equities and blockchain funds rather than directly purchasing cryptocurrency (though you should still expect volatility when cryptocurrency markets fluctuate).

โ€œDon’t look at it,โ€ advises Yang. โ€œThat’s what you should do. You could sell at the wrong time, make the wrong decision if you let your emotions get out of control.

What If You’re Interested in Cryptocurrency, But Have Yet to Invest?

Set it and forget it is Yang’s approach to cryptocurrency that reflects his stock market investing strategy, but some experts believe crypto is too distinct from past investments to make any historical parallels. That’s why A’Shira Nelson of Savvy Girl Money isn’t rushing in.

โ€œI’m investing in low-cost index funds since I can see history on that,โ€ says Nelson. Her wariness of these wild fluctuations stems from the newness of cryptocurrency and the lack of tangible data.

Investors looking to acquire the drop should be aware that fluctuations are typical, and that this sort of volatility will occur in the future. Even if you invest right now when prices are cheap, anticipate them to fall even further. Again, only put in what you’re okay with losing โ€” after you’ve addressed other financial matters, such as emergency funds and more standard retirement accounts.

Bitcoin Price Down Today: Bitcoin Price, Bitcoin News Today, Bitcoin Share Price

What’s Behind the Recent Bitcoin Price Drop?

Some investors regard Bitcoin’s price fluctuations as part of the fun, but “volatility is difficult for individual investors to manage,” Noble adds. He advises against selling too quickly, much like Yang.

Following the country’s continuing conflict with COVID-19, new regulatory measures by the US government, as well as the passage of new crypto legislation in the infrastructure bill, there has been a substantial range of fluctuation in price.

It doesn’t take much to send big price fluctuations in the cryptocurrency sector, which is still relatively young and unproven. In a broader sense, new short-term traders who are selling their bitcoins as a response to the most recent drop may be contributing to Bitcoin’s decline, according to a study from Glassnode Insights, a blockchain research firm.

Noble claims that, if anything, he’s been astonished by the drops this year. “I thought the market was maturing and these events would become less frequent and severe. I was very mistaken,” says Noble.

Some of this year’s dumps, Noble suspects, have been caused by a variety of factors, ranging from excitement over low-quality coins to Elon Musk’s bad reviews to China’s recent crypto service crackdown. This mix of circumstances has the potential to make sell-offs “more violent,” according to Noble.

He points to the stock market crash of 1987, which took months for the markets to recover. However, Noble claims that due to the speed with which cryptocurrencies trade now versus equities did in the 1980s, we may witness a recovery sooner.

โ€œDon’t worry and puke,โ€ Noble adds. โ€œYou can try to endure the swings if you keep your bets small.โ€


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