The Bitcoin (CRYPTO: BTC) price has edged up 1% over the past few hours. Yet the worldâs original crypto is down 13% since this time last week, currently trading for US$21,463 (AU$31,131).
Meanwhile, Ethereum (CRYPTO: ETH), the worldâs number two token by market cap, has tumbled 19% over the seven days, according to data from CoinMarketCap. Ether is currently trading for US$1,605.
Thatâs a far different story than we saw playing out in July.
Last month BTC gained 22% while the Ethereum price rocked 56% higher.
Which begs the question, is the Bitcoin price rally and broader crypto charge over?
Why is the Bitcoin price in retreat?
After posting a strong run from mid-June through mid-August, part of the past weekâs price falls are likely due to some near-term profit taking.
A larger part of the retreat comes from the renewed risk-off sentiment among global investors. This follows on last weekâs release of the minutes from the US Federal Reserve, which reiterated the central bankâs intentions to continue lifting interest rates until it gets soaring inflation under control
The Bitcoin price has moved very much in tangent with risk assets in 2022, though often with bigger ups and downs than witnessed with growth shares.
With investors re-evaluating the prospect of sharply higher rates, the tech-heavy NASDAQ closed down 2% on Friday. That put the index down 2.7% for the week after a lengthy stretch of gains.
That doesnât necessarily mean the Bitcoin price wonât rally higher again. But so long as other risk assets are floundering, cryptos will have a hard time recouping their former highs.
All-time highs
Itâs easy to forget that both of the worldâs top two cryptos were trading at all-time highs just nine short months ago.
The Bitcoin price hit record highs of US$68,790 on 10 November 2021. Itâs down 69% from that high water mark.
As for Ethereum, it reached its own apex on 16 November, trading for US$4,892. Ether has dropped 68% from those highs.
The post Cryptos retreat. Is the Bitcoin price rally over? appeared first on The Motley Fool Australia.
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More reading
- 3 cryptos I would regret not buying on the dip
- This company profited $2.6 billion from crypto. What is it investing in now?
- 2 cryptos that could lead the market recovery
- Why Bitcoin, Ethereum, and Dogecoin are slumping today
- This is why Ethereum has been outpacing the Bitcoin price gains. Will it last?
Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Bitcoin and Ethereum. The Motley Fool Australia has positions in and has recommended Bitcoin and Ethereum. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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