Bitcoin is experiencing a severe downturn over the past few days. After trading above $96,000 on Monday, its price slipped below $80,000 today for the first time since November 11. This rapid decline marks a nearly 18% slump since the start of the week. From its all-time high of $109,588 on January 20, Bitcoin has now shed approximately 27% of its value.<\/p>\n
Several factors have converged to exert downward pressure on the cryptocurrency. These include the newly imposed Trump tariffs, large-scale outflows from spot BTC ETFs, and exceptionally high levels of liquidations in the futures markets. While sentiment has clearly taken a hit with the Fear and Greed Index at 16 (\u201cExtreme Fear\u201d), some analysts note that these conditions could also be setting the stage for the next significant move\u2013\u2013be it further downside or a potential rebound.<\/p>\n
Renowned crypto analyst Scott Melker, also known as \u201cThe Wolf Of All Streets,\u201d highlights<\/a> a developing bullish divergence on multiple timeframes. In a post on X, Melker writes: \u201cBTC 4-HOUR: Bullish divergence still building after the hidden bearish divergence I was watching for. This could fail, obviously, but RSI is holding up well. If you have been following me for years, this is my favorite signal when confirmed. Oversold RSI with bullish divs building over multiple timeframes.\u201d<\/p>\n Technical analyst Tony \u201cThe Bull\u201d Severino, CMT (@tonythebullBTC) believes<\/a> the market may be tracing out a familiar corrective pattern similar to what occurred in 2021 and 2022. He suggests this pattern \u201ccould get an extended fifth of a fifth situation that takes us well into late 2025.\u201d He added that \u201cthis does mean this could go a lot lower than many are expecting, to about $75,000 if the same higher degree fractal is followed to the 0.5 Fib retracement.\u201d<\/p>\n Severino also cautions that traders \u201cdo not want to see Bitcoin tag the monthly Parabolic SAR, currently located at $75,742,\u201d as a breach of that level could signal a deeper correction. He expects the Parabolic SAR will rise slightly by the monthly close, potentially pushing the critical support zone into the low $80,000 range.<\/p>\n Prominent trader Josh Olszewicz (@CarpeNoctom) tracks the Ichimoku Cloud for key insights. He points<\/a>\u00a0to a possible retest of Bitcoin\u2019s weekly kijun, referencing \u201cweekly kijun support at 74k if we keep going.\u201d Olszewicz notes Bitcoin last tapped the weekly kijun during the yen carry trade unwind in August 2024\u2014an event that saw heightened volatility across global markets.<\/p>\n Analyst Daan Crypto Trades (@DaanCrypto) draws<\/a> parallels with previous market cycles when Bitcoin\u2019s Daily RSI dipped to the 20 level: \u201cThe last time BTC was this \u2018oversold\u2019 [at 20] on the Daily RSI was back in August 2023 when it was trading at $25K. The time before that was after the FTX implosion<\/a> at the bear market bottom in late 2022. Short term this means little but it should start peaking your interest.\u201d<\/p>\n He also spotted significant buy orders on Binance futures: \u201cBTC ~$1.8 Billion in Bids has appeared on the Binance futures pair. These bids are sitting between $70K-$79K. What happens when bids like these appear is varied. Sometimes price never moves into them, when it does start hitting them, it often fills a lot of them before (shortly) reversing. Keep in mind, these are bids that can just as easily be pulled away. Highlighting this as it\u2019s an insane amount and this is something you rarely ever see.\u201d<\/p>\n Ki Young Ju, CEO of CryptoQuant, highlights the role of liquidity<\/a> in determining Bitcoin\u2019s trajectory. He noted spot volume was \u201chighly active around $100K,\u201d but explained that \u201cprices drop when new liquidity dries up.\u201d For Ju, the key question is: where will fresh liquidity come from if the market is already in a distribution phase?<\/p>\n