Bitcoin holds steady below $50,000

Bitcoin prices fluctuated on Sunday but remained below $50,000, extending a weekend of wild trading that sent the cryptocurrency down more than 17 percent in just 24 hours. The cryptocurrency traded at $48,776.

Earlier in the day, the cryptocurrency fell more than 2% as it attempted to reclaim the $50,000 mark. Prices fell to around $43,000 on Saturday, down from $57,000 in the morning on Friday.

Bitcoin’s precipitous drop follows the broader market’s risk-off tone on Friday. Fears about what the omicron Covid variant means for the ongoing economic recovery prompted all three major averages to close Friday’s trading in the red and post losses for the week.

Investors shifted away from equities and toward safer market areas, with the yield on the 10-year U.S. Treasury falling.

Crypto Carnage

On Friday, the Nasdaq Composite underperformed the Dow and S&P 500, with technology stocks taking a pounding. This selling extended to cryptocurrencies, with no underlying cause for the sharp drops across the crypto universe.

It appears that someone was likely hit with a margin call yesterday and was thus ‘forced to sell. The Bitcoin market is much thinner on weekends. When the dust settled, the buyer returned, and the situation stabilized.

Nonetheless, the selling in the last 48 hours adds to bitcoin’s recent declines. After falling to a seven-week low of around $54,000, the cryptocurrency officially entered the bear market territory. Bitcoin is currently in “no man’s land,” and this does not appear to be changing anytime soon. The long-term bull case remains intact, but prices seem to be settling between $52,000 and $60,000.

On Sunday, Ether also stabilized, rising about 1.5 percent to $4,176. After falling more than 16 percent between Friday and Saturday morning, the cryptocurrency hit a low near $3,500 on Saturday. By market capitalization, Ether is the world’s second-largest cryptocurrency.