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Bitcoin Falls Back to $61,000 After Closing at a Record High

Bitcoin price came close to $64,000 and approached a new record high on Wednesday afternoon, before plunging sharply.

The largest cryptocurrency dropped 5% in a matter of minutes, then recovered some ground, and hovered around $60,600 at the time of publication. Analysts said $65,000 was the next key resistance level.

Despite the drop, bitcoin (BTC) was still up more than 7% this week and 44% this month, as analysts attributed the rise to a series of favorable factors: increased demand for bitcoin ETFs, expectations around the next bitcoin halving cycle, expected in April this year, and a positive macroeconomic outlook.

Jim Bianco, president and macro strategist at Bianco Research, said the personal trading volume of bitcoin ETFs on Tuesday surpassed the top ETFs tracking the S&P 500 index SPY and the Nasdaq QQQ.

Noelle Acheson, author of the newsletter “Crypto is Macro Now”, said: “Most of the trades are small in size, which suggests that retail investors are buying, considering the net inflow size ($580 million, with $520 million from BlackRock alone).”

Data from CoinGlass showed that more than $585 million worth of bitcoin long and short positions were liquidated in the past 12 hours.

Bitcoin’s rise coincided with a historic day for the newly launched spot bitcoin ETF. According to data from BitMEX Research, BlackRock’s bitcoin ETF set a new record for net inflows of $520 million on Tuesday, after breaking trading volume records for the past two days. The total amount surpassed the previous single-day net inflow high of $493 million set by IBIT on February 13.

Ethereum (ETH) continued its rally on Wednesday, reaching around $3,470, then giving up some gains, and hovering around $3,200.

On the other hand, the stock market fell, with the S&P 500 index and the Nasdaq Composite index down 0.1% and 0.5%, respectively, at the time of writing.

Raphael Bostic, a member of the Federal Reserve’s Open Market Committee, said on Wednesday that inflation is a persistent problem, and central bank officials will adjust policy slowly, but he did not soothe the market.

Tom Essaye, founder of Sevens Report, said: “The debate between a hard landing and a soft landing is still very important for investors, for one main reason: an economic slowdown is one of the few events that could erase the stock market gains in October.” Research.

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