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Bitcoin struggles for momentum as crypto starts week in the red

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In this photo illustration a Bitcoin (BTC) cryptocurrency logo is seen on a smartphone and a pc screen. (Photo by Pavlo Gonchar / SOPA Images/Sipa USA)
Bitcoin headed lower as the rout that has plagued the market in recent months continued. Photo: Pavlo Gonchar / SOPA Images/Sipa USA / PA

Major cryptocurrencies started the week in the red on Monday, as a lull that has hit the market in recent weeks continued. 

Bitcoin (BTC-USD), the largest cryptocurrency, was trading around 3.6% lower at $34,231 (£24,716) by 9am in London. The cryptocurrency retreated after a small rally over the weekend, having sunk to a low of around $33,000 on Friday. 

After reaching an all-time high above $64,000 in April, bitcoin has been largely range bound in the last few weeks. The world's biggest cryptocurrency has mostly traded above $30,000 while struggling to break above $40,000.

Naeem Aslam, chief market analyst at Avatrade, said bitcoin was at risk of falling lower.

"New retail investors who have been involved in Bitcoin price are still feeling shaky and very few institutional investors understand the long term perspective of Bitcoin price," he said. "This means that the threat of Bitcoin price touching the 25K is still on the table. 

"However, those odds aren’t that strong as they were last week. The Bitcoin price must continue to respect the 30K support level."

Ethereum (ETH-USD), the second most popular token, was also falling on Monday morning. Ethereum was around 3% lower at $2,272. The token had traded above $2,350 on Sunday — its highest point in two weeks. 

Ethereum pulled back after a weekend rally. Photo: Yahoo Finance UK
Ethereum pulled back after a weekend rally. Photo: Yahoo Finance UK

By 9am in London, the broader cryptocurrency market had lost more than 2.8% of its value over the last 24 hours, according to data provider CoinMarketCap.com.

Read more: European markets latest: FTSE 100 muted as Morrisons takeover battle brews

The crypto market has struggled to recapture the momentum seen earlier in the year. A record high for bitcoin spurred the broader market to reach a value of more than $2tn. Today the cryptocurrency market is worth $1.4tn.

Bitcoin's high was driven by increased institutional adoption and boosterism from the likes of Tesla's (TSLA) Elon Musk. Stalling momentum coincided with a crackdown in China, growing concerns about bitcoin's energy use, and waning enthusiasm from Musk.

"Bulls are still not out of the woods yet because bitcoin price has a long way to go before we can really see that any downward move threats are over," said Aslam.

Watch: What are the risks of investing in cryptocurrency?

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