Bitcoin falters for a second day, slides below technical level

Bitcoin’s torrid rally lost more steam this week, with the cryptocurrency lying below its 10-day moving average and falling for a second straight day Thursday.

Bitcoin’s latest gyrations have seen it touch a record of almost $42,000 earlier this month before quickly dropping about 17%. (REUTERS)

Bitcoin's torrid rally lost more steam this week, with the cryptocurrency lying below its 10-day moving average and falling for a second straight day Thursday.

The largest digital asset is down as much as 8.4% over a two-day slide and was trading at $34,670 as of 6:38 a.m. in London, according to price data consolidated by Bloomberg. The wider Bloomberg Galaxy Crypto Index dropped about 1%.

Bitcoin's latest gyrations have seen it touch a record of almost $42,000 earlier this month before quickly dropping about 17%. Debate continues to rage over Bitcoin's perceived value, with believers pointing to factors such as institutional interest in the cryptocurrency as an inflation hedge. Others see the return of another speculative bubble echoing its 2017 collapse.

Bitcoin is struggling to maintain its momentum from the end of 2020, falling below its 10-day moving average for a third time this month after a sustained run above the level since early December.

The digital asset is also on track for a second straight weekly decline, the first time that's happened since the start of October. That drop did, however, precede a seven-week run higher that later turned parabolic.

While Bitcoin has seen an incredible jump to an all-time high since the beginning of the year, the currency has been plagued by criticism that the increase has been"excessive" and there are fears that it will not be able to draw fresh money from investors to keep up the momentum. With a 400% rally in the past year, Bitcoin is now officially being termed as the world's ‘most crowded trade.'  

- With inputs from HT Correspondent