Bitcoin drops below $42,000 📉

The largest cryptocurrency was unable to sustain yesterday's gains and is currently trading at $41,800. Altcoins are also suffering losses, with Avalanche (AAVE), Curvedao, Zcash, and Intercomp being the top laggards, with declines exceeding 10%. Alongside the downturn in the crypto market, there is also a slight correction in the U.S. stock market, where profit-taking dominates at the major indices during the last session of the 2023 year.

• CryptoQuant data indicates that Bitcoin miners have recently sold a record amount of Bitcoin, approximately $130 million (over 3,000 BTC in 24 hours). Their BTC reserves are currently the lowest since May, emphasizing that the recent rally was used for distribution.
• Simultaneously, reports from the SEC suggest that all institutions have met the SEC's issued deadline today and updated their applications for a spot Bitcoin ETF, complying with the requirements of the U.S. regulator.

Current calendar of spot Bitcoin ETF applications at the SEC. Source: Bloomberg Finance LP

Bitcoin (H1 Interval)

Taking a look at BITCOIN chart at H1 interval, we can observe that the cryptocurrency has dropped below 50- and 200-period moving average, and launched a downward impulse. Given size of previous pullbacks, one cannot rule out a potential test of the 23.6% retracement of the upward move launched in October. A break below the $40,000 area may pave the way for a test of the $37,700 area, where the 38.2% retracement can be found.

Source: xStation5