Bitcoin Keeps Falling, Hitting Two-Month Lows Amid ‘Little Reason for Optimism’

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Bitcoin
and other cryptocurrencies continued to decline Friday, sliding further from key levels as analysts eyed a gloomy technical backdrop for digital assets with few immediate catalysts for a rebound.

The price of Bitcoin has fallen 4% over the past 24 hours to $26,400, its lowest level in almost two months. The largest digital asset continues to languish well below the technically and psychologically important zone around $30,000, which prices topped in April for the first time since June 2022, when the crypto crash accelerated into a brutal bear market. Bitcoin has failed to consolidate these gains and has accelerated lower in recent days despite catalysts that could be read as positive.

“Bitcoin is trading at … its lowest level since March 17, losing over 15% from its peak last month,” said Alex Kuptsikevich, an analyst at broker FxPro. “Bitcoin’s return to $25,000 looks like a real prospect in the coming days.”

While macroeconomic data have provided catalysts in recent days, Bitcoin has failed to capitalize on trends indicating an improving backdrop for the most risk-sensitive assets, like cryptos and high-growth stocks like those in the tech sector. 

In the stock market, the tech-heavy

Nasdaq Composite
—which tends to trade more like Bitcoin than do the

Dow Jones Industrial Average
and

S&P 500
—has marched higher amid signs of cooling inflation. Disinflation should allow the Federal Reserve—whose campaign of dramatic interest-rate hikes over the past year have wreaked havoc on Bitcoin and tech stocks alike—to pause, supporting high-growth assets.

But it has done little to buoy Bitcoin, adding to worrying technical signs of cryptos weakening. Sentiment over digital assets also has taken a hit, with the Crypto Fear and Greed Index falling to 49 on Friday, indicating neutral sentiment but sitting at the lowest levels since early March, when a selloff pushed Bitcoin close to $20,000.

“The local technical pattern offers little reason for optimism,” added Kuptsikevich, citing Bitcoin’s plunge through its 50-day moving average earlier this week and stagnation below another support line at $27,500. “In other words, we see more than just a correction of this latest growth impulse,” said the analyst.

Beyond Bitcoin,

Ether
—the second-largest crypto—fell 3% to below $1,775. Smaller cryptos or altcoins were more mixed, with

Cardano
up 2% and

Polygon
down 1%. Memecoins were also mixed, with

Dogecoin
hovering around flat and

Shiba Inu
shedding 2%.

Write to Jack Denton at jack.denton@barrons.com