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Bitcoin (BTC) appears to be caught in a strong bearish trap as the price slumps below $80,000, erasing months of gains. Market uncertainty has intensified following fresh tariffs on China and possibly the UK, leading institutions like BlackRock to liquidate billions in BTC and ETH ETF holdings. This institutional sell-off has exacerbated the selling pressure, driving Bitcoin further into bearish territory.
Short Liquidations Dominate the Market
Since breaking down from its consolidation range around $96,000, Bitcoin has faced growing bearish sentiment. Traders have increasingly turned to shorting BTC, with short positions now outpacing longs by a significant margin. Data from Coinglass reveals that Bitcoin shorts have outnumbered longs by 10:1, with leveraged short positions exceeding $1.52 billion compared to just $10 million in longs.
A crucial support level at $78,565 is currently under threat. If BTC breaks below this level, it could trigger further declines, potentially dragging the price toward $75,000.
What’s Next for Bitcoin?
Bitcoin’s weekly chart is flashing massive bearish signals. A single weekly candle has wiped out gains accumulated over the past several months, leaving traders concerned about further declines. With bullish sentiment fading, Bitcoin is approaching a critical support zone. If bulls fail to defend these levels, BTC could face another 20% drop, pushing the price below previous highs.
Currently, Bitcoin is testing a key support level that once acted as strong resistance during the last bull run. A failure to rebound from this zone could lead to a repeat of Bitcoin’s 2022 price pattern, when BTC broke below its ascending trend line and plunged to the 2018 highs, marking the bear market bottom.
If BTC falls below $72,207, selling pressure may intensify, dragging the price closer to $69,000. While bulls may attempt a rebound, the bears remain firmly in control, potentially keeping Bitcoin on a downward trajectory until a new bottom is established.
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.
Also Read: Bitcoin (BTC) Crashes Below $80K as $1 Trillion Wiped from Crypto Market—Is $70K Next?
I’m a crypto enthusiast with a background in finance. I’m fascinated by the potential of crypto to disrupt traditional financial systems. I’m always on the lookout for new and innovative projects in the space. I believe that crypto has the potential to create a more equitable and inclusive financial system.
