After hacking around early Wednesday, bitcoin tumbled during the US afternoon, falling to a session low below $66,000, again putting pressure on the lower end of its recent range.
After trading at $68,500 overnight, BTC was down 2.5% over the past 24 hours and last traded at $66,200.
Crypto stocks, which started the day on a stronger footing, followed suit, paring their gains or snapping into declines across the board. Most notable was Coinbase (COIN), which reversed its 3% morning advance to a 2% drop in the afternoon. Strategy ( MSTR ), his biggest bitcoin holding, fell about 3% as the underlying asset weakened.
After a brisk start to the session, US stocks had given back much of their gains shortly before the trade close. Not surprisingly, hawkish minutes from the January meeting of the Federal Reserve’s Federal Open Market Committee (FOMC) helped. As expected, most at the central bank agreed with the decision to pause rate cuts, but – in a twist – several suggested that the Fed favor “bilateral” guidance, where the bank can choose to raise interest rates if inflation continues to remain sticky.
Already higher for the day, the US dollar gained even more strength, with the dollar index (DXY) – which measures the greenback against a basket of major foreign currencies – climbing to its strongest level in nearly two weeks. A stronger dollar often weighs on risk assets, and Wednesday’s crypto slide seemed to fit this pattern.
With today’s slide, bitcoin is now staring at a fifth consecutive week of losses, its worst streak since the long bear market of 2022.
It also faces a key test at current levels. The $66,000 area was held as support last week and helped push over $70,000. If this floor proves decisive, traders will likely start seeing the lowest prices in early February at $60,000 or a new leg lower.
