Bitcoin (BTC) is facing a tough battle for support after a macroeconomic scare caused a significant halt in its bull market. The price of Bitcoin has dropped by over $12,000 in just two days, dipping below $96,000 on December 19. Despite the volatile move, crypto traders and analysts are bracing for even more downside, with some targeting a dip to the $80,000 range.
Bitcoin’s sudden price plunge sent shockwaves through both retail and institutional investors, causing a surge in liquidations. According to CoinGlass data, nearly $900 million worth of liquidations occurred within 24 hours. Investment firm Farside Investors reported a record-breaking $679 million net outflow from U.S. spot Bitcoin exchange-traded funds (ETFs), further highlighting the growing unease in the market.
Notably, X (formerly Twitter) commentator BitQuant, known for his long-term bullish stance, warned that Bitcoin’s recent dip to $90,000 was not the bottom. In his latest analysis, BitQuant suggested that BTC/USD is still on track to test deeper support levels, possibly heading into the mid-$80,000 range. This caution comes despite an earlier projection of Bitcoin reaching $95,000 before attempting to break previous all-time highs.
Bitcoin’s decline is also drawing attention from on-chain analysts like Whalemap, who have identified significant accumulation zones. These areas, located between $60,000 and $67,000, represent levels where large investors have been actively buying, signaling potential support if the price continues to slide.
The macroeconomic backdrop has played a pivotal role in Bitcoin‘s recent struggles. A shift in U.S. Federal Reserve policy has dampened risk asset rallies, with the central bank lowering its interest-rate cut expectations for 2025 amid rising inflation concerns. While some analysts attribute the crash to the Fed’s hawkish stance, others argue that the real culprit is the market’s overly bullish positioning heading into the correction.
At the time of writing, Bitcoin is hovering around $97,000, relatively flat from its daily open. However, with major support levels now in question, the next few days will be critical in determining whether Bitcoin can regain its footing or continue its downward trajectory.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
About The Author
