Bitcoin retreated on Thursday as a broader sell-off in U.S. technology stocks dampened investor sentiment across risk assets, with profit-taking in the tech sector spilling over into the cryptocurrency market.
The world’s largest cryptocurrency fell around 1.5% from its recent three-week high, trading near $64,500 after rallying earlier in the week on softer-than-expected U.S. inflation data.
Markets initially reacted positively after both the Consumer Price Index (CPI) and Producer Price Index (PPI) for June came in below expectations, raising hopes that inflationary pressures were easing. However, gains faded as investors shifted toward profit-taking, particularly in technology stocks.
Chipmaker Micron Technology led the decline, falling 15% during Thursday’s session and extending its losses to more than 30% from its record high reached in late June.
Market analysts said retail investors have increasingly been locking in profits after the strong rally in technology shares. According to market data, retail trading activity in individual stocks has surged significantly this year, reflecting heightened investor participation.
The weakness in technology stocks also affected cryptocurrencies, with Bitcoin giving up part of its recent gains as traders adopted a more cautious stance.
Technical analysts noted that Bitcoin is facing strong resistance near key price levels. Some market participants believe the latest recovery could stall around overhead resistance before the cryptocurrency attempts another upward move.
Analysts also pointed to Bitcoin’s longer-term technical indicators, suggesting the market may continue to experience volatility until a clearer breakout or trend reversal emerges.
Despite the short-term pullback, Bitcoin remains well above its recent lows, with investors continuing to monitor U.S. economic data, Federal Reserve policy expectations, and broader market sentiment for clues about the next major price direction.
