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Bitcoin price dropped by nearly 7% just two days after the spot ETF approvals. Cointelegraph investigates why BTC price is correcting. This article explores the potential reasons why Bitcoin is down following the 11 spot bitcoin ETF approvals by the SEC on Jan 2025. According to on-chain analytics firm Glassnode, Bitcoin's price drop might have been driven by both derivatives leverage and spot profit taking. However, several metrics Bitcoin’s recent journey has been marked by significant price swings following the approval of multiple-spot Bitcoin ETFs, leading to both optimism and uncertainty among traders. According to recent data, BTC recently dropped below $42,000 from a 24-hour Major asset managers have finally secured SEC approval for spot Bitcoin ETFs to meet surging demand from institutional investors seeking Crypto exposure. Retail Most people expected the price to hit $55k after the approval failed to occur and so are either profiting from this or selling out their long positions in bitterness. Bitcoin

Why is Bitcoin Dumping After Spot ETF Approval? A Deep Dive

Bitcoin\'s recent journey has been marked by significant price swings following the approval of multiple-spot Bitcoin ETFs, leading to both optimism and uncertainty among traders. Why the volatility? Why is Bitcoin down now that spot ETFs are finally here? This article explores the potential reasons why Bitcoin is down following the 11 spot bitcoin ETF approvals by the SEC on Jan 2025. Cointelegraph investigates why BTC price is correcting. Bitcoin price dropped by nearly 7% just two days after the spot ETF approvals.

Profit Taking and Derivatives Leverage: The Culprits?

According to on-chain analytics firm Glassnode, Bitcoin\'s price drop might have been driven by both derivatives leverage and spot profit taking. Many investors who bought Bitcoin in anticipation of the ETF approval are now taking profits, contributing to the downward pressure. Furthermore, leveraged positions in the derivatives market can amplify price movements, exacerbating the sell-off.

"Buy the Rumor, Sell the News" in Action?

Major asset managers have finally secured SEC approval for spot Bitcoin ETFs to meet surging demand from institutional investors seeking Crypto exposure. Retail investors piled into Bitcoin leading up to the approval, expecting a massive price surge. Most people expected the price to hit $55k after the approval failed to occur and so are either profiting from this or selling out their long positions in bitterness. This "buy the rumor, sell the news" phenomenon is a common market pattern where the price rallies in anticipation of an event but then corrects after the event occurs.

Below $42,000: Where is Bitcoin Headed?

According to recent data, BTC recently dropped below $42,000 from a 24-hour high. However, several metrics suggest this correction could be temporary. Continued institutional investment through the ETFs and long-term bullish sentiment could provide support for a rebound. Investors should carefully monitor market conditions and manage their risk accordingly.

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