Bitcoin Dips 1.7% to $109,000 as US Markets Close for Memorial Day

Bitcoin's recent rally has encountered a temporary halt, with the cryptocurrency slipping back to $109,000 on Monday after a soft rise over the weekend. This stagnation comes as traditional U.S. markets remained closed for Memorial Day, contributing to a lack of trading momentum. Despite this setback, Bitcoin is still up 1.7% in the last 24 hours, remaining close to the all-time high it reached last week.

The top cryptocurrency's performance has been influenced by various factors, including the Trump administration's temporary delay in implementing 50% tariffs on EU goods. This decision, announced on Sunday, led to a rebound in European stocks and spurred overnight gains in several digital coins, including Uniswap, Chainlink, and Avalanche. However, the overall market sentiment remains cautious as traders digest the rapid price movements of recent weeks.

Analysts from Bitfinex have noted that Bitcoin has likely entered a choppy phase, with increased profit-taking by short-term holders potentially capping its near-term upside. Over the past 30 days, short-term holders have realized $11.4 billion in cumulative profits, a significant increase from the $1.2 billion seen in the previous 30-day period. This heightened profit-taking could lead to a stall or retracement in prices if new demand inflows do not match the supply.

The next few days will be crucial in determining whether the recent dip to $106,000 has set the range lows or if a more significant reset is on the horizon. According to Bitfinex analysts, the key level to watch is the short-term holder cost basis around $95,000, which represents the average price at which this group bought the asset. Strong inflows to U.S. spot Bitcoin ETFs, low volatility, and a lack of market froth suggest that Bitcoin may resume its uptrend into the third quarter of the year after a brief pause.