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- Bitcoin fell to $81K, wiping out $750M in long positions.
- Investor sentiment is at “extreme fear,” signaling risk-off conditions.
- Analysts predict further downside, possibly reaching $58K.
Bitcoin extended its recent sell-off on Thursday, sliding to two-month lows near $81,000. Key support levels—including the 2026 yearly open at $87,000, the $84,000–$86,000 demand zone, and the 100-day moving average—failed to halt the decline. The tumble wiped out over $750 million in long positions, contributing to $1.6 billion in total liquidations, highlighting growing unease among traders.
Investor Sentiment Hits “Extreme Fear”
Crypto markets are now operating in risk-off mode. The Fear and Greed Index for Bitcoin dropped to 16, signaling “extreme fear,” down from 26 the previous day. Analysts note that such readings often accompany sharp sell-offs or leverage flushes.
Economist Timothy Peterson emphasized the broader context, pointing out that consumer sentiment is nearing record lows. “People just don’t buy Bitcoin or any other risk assets in an environment like this,” he said on X, adding that a market upcycle is unlikely until sentiment improves. Historically, similar periods of fear have followed major market shocks, including the FTX collapse, reinforcing uncertainty in BTC price movements.
Analysts Eye Lower Price Targets
With bearish momentum dominating, traders are now preparing for further declines. Some analysts suggest Bitcoin could retest its 200-week simple moving average (SMA), currently near $57,974. According to trader Daan Crypto Trades, these long-term moving averages often present strong value opportunities for patient investors, even during sideways price action.
Also Read: MSTR Stock Plummets 9.5% as Bitcoin Slides Below $83K
Keith Alan also highlighted parallels between Bitcoin’s current weekly performance and patterns seen in 2021–2022. While he expects short-term rallies, Alan predicts a continued bear market that could push BTC below $74,000, potentially reaching the 2021 all-time high of $69,000. Other forecasts suggest that 2026 could remain a bearish year, with Bitcoin possibly declining toward $58,000.
Caution Prevails
Overall, Bitcoin’s price action underscores a highly cautious market environment. Extreme fear readings, failed support levels, and ongoing liquidations suggest that traders may face further downside before a meaningful recovery occurs. Long-term investors may see lower price zones as potential accumulation points, but the near-term outlook remains uncertain.
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.
I’m your translator between the financial Old World and the new frontier of crypto. After a career demystifying economics and markets, I enjoy elucidating crypto – from investment risks to earth-shaking potential. Let’s explore!
