Bitcoin reached new highs on Tuesday exceeding $125,000, then slipped back towards the $122,000 range as profit-taking, a strengthening dollar cooled momentum.
It has been a volatile week again for Bitcoin, which reminds everyone, once again, that crypto is not for the faint-hearted. After smashing through new highs on Tuesday 7th October, Bitcoin turned around almost as quickly, leaving traders wondering what just happened.
Earlier this week, Bitcoin climbed above $125,000 (€116,250), setting a new record that had social media buzzing and analysts throwing out fresh predictions. The hype was not randon – there were real drivers behind the surge. A mix of huge ETF inflows, a weaker U.S. dollar and a renewed wave of “safe-haven” demand all lined up at once.
Reuters data showed that nearly $6 billion had poured into Bitcoin exchange-traded funds in just one week. The narrative around “digital gold” re-surfaced, comparing Bitcoin to a traditional commodity like gold, which itself crossed $4,000 per oz, for the first time. So, the BTC rally made sense, at least on paper. Bitcoin touched $125,600, which was its highest level ever.
However, by late Tuesday, the momentum started to fade. Prices slipped, then fell faster as profit-taking kicked in. Within hours, Bitcoin had dropped back toward $122,000 (€113,460), erasing nearly two days of gains. By Wednesday morning, Asia time, it was hovering around the low $122k range.
Why did Bitcoin drop suddenly?
Some may ask why Bitcoin dropped so suddenly. The U.S. dollar rebounded slightly, which tends to put pressure on speculative trades. Some large wallets moved coins onto exchanges, usually seen as a sign of profit-taking. Plus, after such a rapid price increase, technical indicators were flashing “overbought.”
There was no single piece of bad news or change in regulation, no exchange hacks and no panic headlines. This looked more like the natural ebb and flow of a bull market. When prices rocket up that fast, a quick correction is almost guaranteed.
In any event, Bitcoin still looks strong from a broader perspective. On-chain data shows limited selling by long-term holders and ETF inflows have not yet dried up. Furthermore, Bitcoin is still sitting about 45% higher than it was just three months ago.
What happens next depends on how the market handles this current range. If BTC can hold above $121,000 – 122,000, this could turn out to be a healthy reset before the next surge.
Either way, this week was a reminder that crypto’s biggest strength, which is its volatility, is also what keeps people glued. Whether you see Bitcoin as a revolutionary asset or just a risky bet, there’s no denying it continues to move the financial world in ways few things can. See our BTC chart below and track live performance.
Live Bitcoin Price Chart
News written by FX Trust Score.
Follow all the latest Bitcoin and crypto news in our dedicated Market News section.
