Bitcoin price drops to $27,400 as traders take profits

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Bitcoin price drops to $27,400 as traders take profits

Bitcoin slid to near $27,400 from a short-lived rally above $28,000 at the start of the week as traders took profits as jitters in traditional financial markets weighed on cryptocurrency prices.

BTC sank to $27,275 in the U.S. early Tuesday morning, down 3.5% in the past 24 hours, according to CoinDesk data. The coindesk market index, a broad-based weighted index of hundreds of tokens, fell 3.4%, indicating profit-taking across the board.

The drop occurred due to a continued increase in bond market yields, which took a toll on risk assets across the board. The 10-year U.S. Treasury rate surged 8 bps to 4.76%, a fresh 16-year high early Tuesday, helping the S&P 500 and the tech-heavy Nasdaq 100 lower 1.3% and 1.6%, respectively.

Mike McGlone, senior macro Strategist at Bloomberg Intelligence, said in an X post. In a report, he said that the U.S. Federal Reserve is still on the path of tightening liquidity conditions and that a declining BTC price has typically led to Fed pivots. This is unlikely to be the beginning of a significant rally without any other catalysts to drive it, Keily cautioned, adding that the ongoing Sam Bankman-Fried trial 'could take things either way' based on possible new information about crypto markets.