Bitcoin Dips Below $40,000: The Rollercoaster Ride of Crypto and What Lies Ahead

The Great Bitcoin Dip: What Happened?

On January 10, Bitcoin (BTC) took a nosedive, falling below the critical $40,000 threshold after teasing traders with three days of price fluctuations. It seems that while Bitcoin was busy crisscrossing this pivotal price point, altcoins like Dash (DASH) and Bitcoin Cash (BCH) took center stage. This BTC retreat can largely be attributed to its inability to break through the $41,500 resistance level during the weekend trading frenzy.

Miners on the Move: Is it a Sell-Out?

One key factor contributing to Bitcoin’s recent decline is the uptick in selling activity among miners. The Miner’s Position Index (MPI)—which calculates the ratio of Bitcoin leaving miner wallets compared to its one-year moving average—has recently indicated that miners are cashing out.

CryptoQuant’s CEO, Ki Young Ju, pointed out just before the drop, “Miner Position Index looks enough to make a local top.” He went on to add, “They’re selling $BTC. I’m going to punt a small short to scalp $BTC in this short-term bearish market.”

Extreme Sentiments: Fear and Greed in Crypto

The crypto atmosphere hasn’t helped either, as sentiments remain precariously high on the Crypto Fear and Greed index—staying above 90 for the past two months. Talk about extreme greed! This extensive period hoisting a warning flag suggests a potential pullback might be on the horizon.

Altcoins Take the Limelight

Meanwhile, the spotlight has shifted dramatically toward altcoins. Bitcoin Cash seems to be following in Ethereum’s footsteps, skyrocketing from $420 to a hefty $630 within just 24 hours! The chart’s upward movement signifies a technical breakout, and BCH is now dancing at its highest levels since November 2018.

Dash Goes to the Moon: A Surprising Upsurge

Not to be outdone, Dash has proven to be the dramatic hero of the day, with its price surging a staggering 40%. At one point, Dash’s price shot up more than 100% from $95 to $194, although it has since pulled back to the $140 territory. This season of altcoin rallies reflects a possible shift from Bitcoin domination, marking a significant transition as analysts dub it the start of an “altseason.”