Investors take profits as Bitcoin experiences flash crash

It had been coming for a long time, it was clearly predicted and on Monday it happened. Bitcoin fell 7.5% at one point to trade between $40,000 and $41,000 again. At the time of writing, Bitcoin is trading for $41,800.

Bitcoin’s decline did not happen like a stock market share usually does with some minor movements towards the bottom but with a very long straight red candle in a so-called flash crash.

#Bitcoin just closed it’s 8th green weekly candle in a row.

This week’s candle was a monster.

When correction, sir? pic.twitter.com/xxWjTxxLLr

— The Wolf Of All Streets (@scottmelker) December 11, 2023

“It makes sense to see some profit taking,” said Tony Sycamore, a market analyst at IG Australia. He expects a possible fall toward the $37,500 to $40,000 range to be “well-supported” by dip buyers.

Federal Reserve

As of now, Bitcoin, Ether and all other major cryptocurrencies are waiting for news from the Federal Reserve (which meets on December 12 and 13).

In their last meeting of 2023, Fed Chairman Jerome Powell and his colleagues will let the financial markets know whether they are ready to (finally) cut interest rates in the coming months so that the economy can grow again.

Over $330M of #Bitcoin long positions have been liquidated since $BTC fell below $43,000 in today’s flash crash! 📉

— Breaking Whale (@BreakingWhale) December 11, 2023

Test

Bitcoin has already gained about 150% this year. Wall Street is awaiting the approval of a Bitcoin ETF and crypto investors appear to have put all the terrible news of 2022 behind them.

If the Federal Reserve is somewhat positive this week, some crypto analysts expect a retest of the $45,000 level to happen before the end of the year.