Bitcoin rally loses steam as crypto prices slide

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The price of bitcoin (BTC-USD [https://seekingalpha.com/symbol/BTC-USD]) on Tuesday pulled back a day after notching a new record high above $126K, coinciding with weakness across other risk assets.

The original cryptocurrency (BTC-USD [https://seekingalpha.com/symbol/BTC-USD]) retreated 2.1% in the last 24 hours to $122K at 12:50 p.m. ET, after rallying to as high as $126.2K a day earlier. But the token was still up around 2% in the past five sessions and +10% from a month ago. Year-to-date, BTC climbed 29%. Ether (ETH-USD [https://seekingalpha.com/symbol/ETH-USD]), the world's largest altcoin, gapped down 4.1% to $4.49K at press time.

Other major tokens in the red intraday [https://seekingalpha.com/etfs-and-funds/etf-tables/cryptocurrency] include: Mantle (MANTLE-USD [https://seekingalpha.com/symbol/MANTLE-USD]) -8%, Ethena (ENA-USD [https://seekingalpha.com/symbol/ENA-USD]) -7.6%, Cronos (CRO-USD [https://seekingalpha.com/symbol/CRO-USD]) -7.1%, Avalanche (AVAX-USD [https://seekingalpha.com/symbol/AVAX-USD]) -7%, Uniswap (UNI-USD [https://seekingalpha.com/symbol/UNI-USD]) -6.6%, Story (IP-USD [https://seekingalpha.com/symbol/IP-USD]) -6.1% and Dogecoin (DOGE-USD [https://seekingalpha.com/symbol/DOGE-USD]) -5.8%.

At the same time, Wall Street's three major averages, especially the tech-heavy Nasdaq, also saw pressure [https://seekingalpha.com/news/4502383-sp500-nasdaq-composite-dow-jones-stock-market-outlook-news], as investors took some risk off the table as the U.S. government shutdown entered its seventh day. Like BTC, stocks, too, hit all-time highs a day ago.

Bitcoin's (BTC-USD [https://seekingalpha.com/symbol/BTC-USD]) surge to over $126K [https://seekingalpha.com/news/4502082-crypto-tied-stocks-etps-jump-after-bitcoin-tops-125k] on Monday reflected strong market confidence, said Arthur Azizov, founder and investor at B2 Ventures, pointing to steady exchange-traded fund inflows, a weaker U.S. dollar and traders' expectations for more interest-rate cuts as "genuine drivers right now, let alone rising fears amid the U.S. government shutdown."

As such, Tuesday's dip looks more like buyer exhaustion or profit-taking than a fundamental shift.

MORE ON CRYPTO

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