Bitcoin Nosedives Below $41K, Erasing Nearly A Week's Gain As Holders Take Profit

Bitcoin briefly nosedived below the $41,0000 price level at the start of this week, showcasing a streak of volatility, as some holders took profit from the recent price rally.

The world's oldest crypto asset and the largest by market capitalization, plummeted by as much as 7.5% to $40,521 before further sinking by 4% lower at $41,992 as of 10:21 p.m. ET Sunday.

As Bitcoin briefly sunk below the $41,000 price level, data from cryptocurrency futures trading and information platform CoinGlass showed that it caused over $270 million worth of long positions to be liquidated.

The drop in the value of the king of crypto furthermore wiped out around $1.2 billion in open interest on Bitcoin, which was currently at approximately $17.9 billion.

The price plummet recorded the largest single-day nosedive of Bitcoin in a month, which erased the crypto asset's gain for nearly a week, as it listed an over 12% growth over the last 30 days.

Bitcoin showcased an impressive performance when it rallied over 150% since the start of this year.

The price rally of the world's largest crypto asset by market cap was driven by the high anticipation surrounding the potential approval of the U.S. Securities and Exchange Commission of the 13 pending spot Bitcoin exchange-traded fund (ETF) applications.

The crypto community is optimistic that the approval of the crypto investment vehicle would not only allow Wall Street giants to gain exposure to the crypto asset for the first time, but would also pave the way for a significant stream of investment in the broader cryptocurrency market.

Industry watchers also anticipate the Bitcoin Halving event will reduce the number of Bitcoin's total circulating supply, pushing the price up.

Crypto trader and technical analyst, who used the X handle @thescalpingpro, shared the Bitcoin's chart, showing that it had been rejected from the mid-range and explained what this meant for the crypto asset and the broader crypto market.

"Since the $15,500 bottom, after every major upside move, we have seen Bitcoin ranging for a few weeks, followed by a 20-22% correction before the next leg up," the trader said, adding, "If the price follows the same pattern and ranges below the mid-range, we can expect a nice altcoin rally while Bitcoin goes sideways."

The technical analyst also shared that "a -21% pullback from the mid-range would put us at $35,000, which is also a monthly support level. Pullback or No Pullback the Higher Time frame trend stays Bullish & Bull Market Dips are for Buying."

Bitcoin has slowly climbed back to the $42,000 price level, but is still trading in the red zone at $42,431.80 as of 6:00 a.m. ET on Monday with a 24-hour trading volume up by 81.94% at $26,686,430,095.

Bitcoin's latest price action represents a 2.85% drop in the past 24 hours and a 1.8% gain over the last seven days.

Data from CoinMarketCap showed that Bitcoin's current circulating supply stands at 19,566,725 BTC with its value continuously dipping by 2.8% at a $19,566,725 BTC market cap.