Bitcoin Weekly News

Bitcoin’s Price Dropped by 7% – Is it a Bear Trap?

Bitcoin’s price dropped by 7% on Monday and recovered a bit after testing the $40,250 level. It was mentioned in last week’s Bitcoin Weekly news that Bitcoin’s price may reach the $45,000 level after breaking out of the $42,000 level. It can be seen on the charts that the price struggled close to that level and then dropped sharply on Monday.

The important part is that the altcoins didn’t experience that much drop. It can be a sign that altcoin season is about to begin. Most investors eagerly wait for the altcoin season as they get to make a huge amount of money during this season. However, Bitcoin usually remains sideways during the altcoin season.

The following Bitcoin Weekly News may give an idea of how the crypto market may perform over the coming days.

Is This Drop a Bear Trap?

Some traders have taken profits following the 7% drop on Monday whereas other analysts think it’s a buy-the-dip opportunity. These analysts back their claim by showing the long-term bullish trend. The Analysts say that the recent drop may sustain for the short term but the price will eventually boost from here and reach higher targets.

The analysts have marked the $42,000 as a psychological level. Analysts suggest that corrections are normal in an upward trend. In fact, they say that the corrections provide more liquidity for further upward momentum. But it’s worth noting that Bitcoin historically experiences 20% pullbacks during the bull markets.

So, the investors may expect a further decline over the coming days. However, the analysts are confident that the price will eventually move towards higher targets.

Bitcoin Traders are Refraining from High Leverage Risk

The crypto market experienced a liquidation of $340 million worth of long contracts during the recent drop. So, some experts are attributing this decline to whale selling. Binance’s exchange reserves have also declined significantly. So, it can be a major cause of panic selling.

Previously, the traders were taking high-leverage positions to generate more profit. However, the December data shows a significant decline in the leverage ratio. The traders are probably preparing for CPI, PPI, and Unemployment Claims reports because these reports are expected to largely influence the global markets.

Bitcoin Bullish Prediction by Bitcoin Analyst

Bitcoin Analyst has predicted a ‘golden cross’ formation in Bitcoin’s technical chart. The analyst has backed his claim by highlighting El Salvador’s new citizenship program where the country is inviting people to invest $1 million in Bitcoin or USDT. Robinhood’s launch of crypto trading in the EU is another welcoming factor that supports bullish momentum.

James Seyffart, Bloomberg ETF analyst, has also stated that the chances of approval for spot Bitcoin ETF applications are continuously increasing. The Bitcoin analyst has predicted a target of $50,000 based on technical indicators. The analyst is expecting a long-term bullish momentum in Bitcoin. However, he’s warned traders to cautiously trade the lower timeframes.

El Salvador’s Bitcoin Bond Gets Regulatory Approval

Bitcoin Weekly Updates

El Salvador’s Bitcoin bonds (Volcano Bonds) were expected to be launched in March 2022. But the launch was delayed due to several regulatory issues. However, the bonds have now received regulatory approval from the Digital Assets Commission. The authorities are planning to launch these bonds in early 2024.

The purpose of launching these bonds is to fund the crypto-based initiatives of the country while paying down the sovereign debt. These bonds will play the role of a stepping stone for Bitcoin-based capital markets in the country. The investors may expect a 6.5% annual return from these bonds.

Bitcoin Price Update by VanEck

VanEck has predicted a new all-time high for Bitcoin by the end of 2024. VanEck has highlighted the historical price movements of Bitcoin showing that the price surges follow a three-year cycle. VanEck has made this announcement at the Digital Asset Summit 2024. However, the prediction is combined with the warning about the high volatility of the crypto market.

Investors must keep an eye on investor behavior, technological advancements, and regulatory frameworks.

The Economic Potential of El Salvador’s New Freedom Visa

As discussed earlier, El Salvador is targeting Bitcoin and crypto millionaires through its new Freedom Visa program. Under this program, the country will provide citizenship to a maximum of 1,000 people per year. The investors are required to invest $1 million in Bitcoin or USDT to acquire this visa.

The country is currently holding around 2,700 BTC tokens in its reserves. The experts say that the country may achieve at least $1 billion in annual deposits if the program is successful.

Bitcoin Wallet Conio has Partnered with Coinbase

Conio has partnered with Coinbase to integrate different crypto assets into Italian financial institutes. They’re primarily focused on serving the institutes that deal with digital assets. The company currently has more than 400,000 customers and it’s planning to provide support for 50+ tokens by the end of 2023.

The digital assets are widely accepted in the European market. That’s why Conio has taken this step to facilitate the institutes that are interested in joining this landscape.

Bitcoin Weekly Technical Analysis

Bitcoin Weekly News

Although Bitcoin’s price dropped by 7% on Monday, the weekly chart doesn’t show any signs of reversal. For the past eight weeks, Bitcoin’s price has continuously moved to the upside. So, it can be considered a healthy sign of bullish momentum. The price may drop a little further for a few more days. However, it may test the $48,300 level once the bulls take back control.


Bitcoin’s recent 7% drop sparked debates among traders, with some viewing it as a bear trap while others see a buying opportunity. Altcoins’ resilience hints at a potential altcoin season, enticing investors. Analysts identify $42,000 as a psychological level, expecting short-term corrections within the long-term bullish trend.

Positive factors like El Salvador’s Bitcoin bonds and VanEck’s bullish prediction contribute to optimism. While the market may witness further decline, analysts remain confident in Bitcoin’s eventual upward trajectory, emphasizing caution in short-term trading.

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