Bitcoin loses momentum on weekend with support around 2017 high

Bitcoin trended downward through the weekend after a solid unemployment report offered mixed implications for the Federal Reserve as it contemplates its path on interest rates.

The largest cryptocurrency spent time below $20,000 for a ninth consecutive day on Sunday, a session in which it failed to crack above that round-number level at all. On several of the days, it’s fallen into the $19,500 range but not below $19,511, its then-record peak from December 2017.

Bitcoin dropped as much as 0.8 per cent to $19,591 on Sunday and was little changed as of 7.50am in New York.

“The Fed is busy ‘burning’ money as well (a.k.a. quantitative tightening) to restore the credibility of the US dollar,” a report sent Sunday from Gavekal Research said. “That presents a significant headwind for all cryptocurrencies.”

Bitcoin has traded largely in the same direction as other risk assets like the Nasdaq 100 as the Fed boosts interest rates amid stubborn inflation. Meltdowns like those of the Terra/Luna ecosystem and hedge fund Three Arrows Capital have depressed sentiment as well, and numerous crypto firms have declared bankruptcy or are struggling to survive.