Bitcoin Rebounds to $97,000 After Volatile Trading Day

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Bitcoin steadied around $97,000 on Friday, recovering from a sharp dip earlier in the day when it briefly fell below $93,000. This marks a turbulent period for the cryptocurrency, which reached an all-time high of $108,000 earlier this week but has since seen a rapid sell-off amid broader market uncertainty.

Fed Moves and Bitcoin Boosts

The recent pullback comes as the Federal Reserve signaled fewer interest rate cuts for next year, rattling markets and putting pressure on risk assets like equities and cryptocurrencies. This cautious sentiment has weighed on Bitcoin, which, despite its decline, remains up significantly for the year. Its price has more than doubled in 2023, driven by optimism surrounding the launch of spot Bitcoin ETFs and Donald Trump’s victory in the U.S. presidential election. Trump's pro-crypto stance has been a significant tailwind for Bitcoin, helping propel it to new highs earlier this week.

Broader Market Struggles: Bitcoin and Beyond

However, as investor caution grows, Bitcoin isn’t the only asset feeling the pinch. Major equities like Tesla and Nvidia, which also surged following the election, have seen similar declines in recent sessions. Other cryptocurrencies, such as Ether, have also struggled, with Ether trading around $3,446 on Friday.

While Bitcoin’s recent dip has some questioning whether the rally is losing steam, the cryptocurrency’s performance this year remains a standout. The broader market environment, however, is increasingly challenging as concerns over interest rates and economic stability linger. Whether Bitcoin can reclaim its highs or faces more sustained pressure will depend on how these macroeconomic factors evolve in the coming weeks.

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Works Cited

Kharpal, Arjun. “Bitcoin Trades around $97,000, Recovers from Earlier Losses.” CNBC, 20 Dec. 2024, www.cnbc.com/2024/12/20/bitcoin-falls-dropping-further-below-the-100000-mark.html. Accessed 25 Dec. 2024.