Bitcoin’s price rose on Sunday, after snapping a six-day losing streak and avoiding a drop below the key psychological level of $40,000 that some cryptocurrency analysts had warned might trigger a steeper sell-off.
As of press time bitcoin (BTC) was changing hands around $42,100, up 2% over the past 24 hours, based on CoinDesk pricing. The cryptocurrency had been on the verge of a seven-day losing streak that would have been its longest since 2018, but the price turned around on Saturday, eking out a small gain, and has stayed on an upward trajectory since.
The price hadn’t fallen below $40,000 since September 2021, and is well off the all-time high near $69,000 reached in November, so there had been speculation that a drop below $40,000 might spur a deeper retrenchment.
“If the market has based at these levels, we might get that short squeeze we’ve been waiting so patiently for,” the Singapore-based crypto trading firm QCP Capital wrote Sunday on its Telegram channel.
January tends to be a seasonally weak month for bitcoin, but this year has been especially harsh, with the largest cryptocurrency still down 9% so far in 2022.