Bitcoin Faces Bear Market Shift After Dropping Below $100,000, Further Declines Possible

• Bitcoin plunged below key support levels at $117,000 and $112,000, failing to recover and indicating weakening buyer interest.

• The absence of new buyers has deepened bearish trends, as long-term holders sell off holdings amid rising US dollar strength.

• Analysts from 10X Research forecast potential drops to $93,000 or even $70,000, citing limited support and ongoing deleveraging, based on historical cycle patterns.

Bitcoin price under $100,000: Explore the causes of this sharp decline, expert insights on bear market signals, and potential recovery factors. Stay informed on crypto trends—read now for key takeaways.

What is causing Bitcoin’s price to drop under $100,000?

Bitcoin’s price under $100,000 stems primarily from a cascading liquidation event on October 10 that forced out leveraged positions, according to data tracked by CoinGecko. This triggered a 20% fall from the asset’s all-time high of $126,000, as reported by Cryptopolitan, with the cryptocurrency breaching critical support at $117,000 and $112,000 without rebounding. The resulting loss of market confidence has amplified downside pressure in an increasingly bearish environment.

Why are bear market signals intensifying for Bitcoin?

The bear market signals for Bitcoin are intensifying due to the retreat of marginal buyers who fueled recent gains but have now withdrawn, leaving the market vulnerable to further sales. Markus Thielen, founder and CEO of 10X Research based in Singapore, noted on Friday that the failure to reclaim lost support levels confirms a bear phase, stating, “We haven’t really reclaimed this level since then, and I think that’s a sign we are, unfortunately, in a bear market.” His firm, which predicted a drop to $100,000 last month, now anticipates the bottom may be weeks away, with risks of sharper corrections.

Supporting this view, 10X Research highlights that investors entering during upward trends have either sold or paused commitments, while fund managers exposed via exchange-traded products face pressure to reduce stakes as prices slide. The strengthening US dollar adds headwinds, creating an “air pocket” below $93,000 with scant support, potentially leading to liquidations down to $70,000. Thielen also referenced historical patterns where early adopters sell near peaks and re-enter post-stabilization, underscoring cyclical investor behavior that exacerbates current volatility.

Market data reinforces these concerns: net sales from long-term holders have exceeded 1 million coins since June, per analyst Engel’s observations. Retail participation lags behind prior cycles, and ETF inflows have decelerated, diminishing buying momentum. Engel warned that while support might hold above $95,000, near-term catalysts remain elusive, drawing parallels to the failed “Uptober” rally in 2018, which preceded a 37% November plunge.

Frequently Asked Questions

What triggered the recent Bitcoin liquidation event under $100,000?

The October 10 liquidation event was sparked by overleveraged positions unraveling amid heightened volatility, forcing mass exits and amplifying the price drop below $100,000. According to JPMorgan’s analysis, this deleveraging phase has largely concluded, but it eroded key supports and sapped confidence among traders and institutions alike.

Could Federal Reserve actions help Bitcoin recover from its current bear market?

A potential Federal Reserve rate cut in December could inject liquidity and ease pressure on risk assets like Bitcoin, making it more attractive relative to a strengthening dollar. Speculation around central bank transitions, including Jerome Powell’s term ending in May, alongside possible US government reopening, might further bolster market conditions by enhancing economic momentum.

Key Takeaways

• Bear market confirmation: Bitcoin’s inability to reclaim $112,000 support, as per 10X Research, signals a prolonged downturn with limited immediate relief.
• Investor shifts: Long-term holders’ net sales surpassing 1 million coins since June, combined with whale transfers to exchanges, continue to weigh on prices.
• Upside potential: Rising gold volatility positions Bitcoin as a relative safe haven, with JPMorgan eyeing $170,000 in 6-12 months if liquidity improves.

Conclusion

Bitcoin’s plunge under $100,000 marks a pivotal bear market entry, fueled by liquidations, absent buyers, and macroeconomic pressures like a robust US dollar. While experts like Markus Thielen from 10X Research and Nikolaos Panigirtzoglou at JPMorgan highlight downside risks to $70,000 alongside recovery prospects via Fed policy shifts and institutional interest, the path forward hinges on renewed liquidity. Investors should monitor these dynamics closely, as stabilizing factors could pave the way for significant rebounds in the evolving crypto landscape.

The cryptocurrency market has endured significant turbulence this week, with Bitcoin experiencing its most substantial decline in six months. Trading data from CoinGecko reveals the asset now lingers 20% beneath its record $126,000 peak, a direct fallout from the October 10 liquidation cascade that dismantled leveraged trades and intensified selling, as detailed in reports from Cryptopolitan.

Initially, Bitcoin breached the $117,000 threshold before cascading through $112,000, yet attempts to recapture these levels faltered entirely. This persistent failure is interpreted by market observers as a clear indicator of diminishing trust among participants, fostering an environment ripe for extended corrections.

Bearish indicators grow stronger as new entrants vanish

Markus Thielen, the Singapore-based founder and CEO of 10X Research, articulated on Friday that recent price movements substantiate a transition into bear territory. “We haven’t really reclaimed this level since then, and I think that’s a sign we are, unfortunately, in a bear market,” he explained, aligning with his firm’s prior forecast of a $100,000 descent last month.

Looking ahead, 10X Research suggests the market trough could still be several weeks distant, with Thielen cautioning about interim vulnerabilities: “I think there’s this brief risk where we could correct quite a bit more.” The analysis emphasizes the inactivity of marginal buyers—those who piled in during ascents—now either divested or hesitant to reengage.

Institutional players, particularly those with heavy allocations through exchange-traded products, may soon trim positions as underlying values erode, compounding the pressure. The US dollar’s renewed vigor poses an additional challenge, potentially driving Bitcoin toward uncharted lows. Thielen elaborated, “There’s this air pocket below $93,000, and there is not much support. It could be that there is going to be some liquidation that brings us to potentially the $70,000 level.” He further drew on cycle precedents, where pioneering investors offload at highs and return during consolidations, a pattern echoing today’s dynamics.

Liquidity dynamics and evolving participant strategies

Counterbalancing views from analysts point to elements that might arrest the decline, such as an anticipated Federal Reserve rate reduction in December or murmurs of leadership changes at the central bank following Jerome Powell’s May term conclusion. Additionally, the prospective resumption of US government operations could flood markets with fresh capital, alleviating current strains.

Sean Farrell, Fundstrat’s head of crypto, commented in a recent video that the operational hiatus has “stifling liquidity conditions” and heightened anxieties over wider economic vitality. JPMorgan’s research note posits that the October deleveraging episode, which accelerated the downturn, is now in the rearview, potentially clearing a path for stabilization.

Nikolaos Panigirtzoglou, a managing director at JPMorgan, observed that escalating gold market fluctuations have rendered Bitcoin comparatively enticing to certain portfolios. He projected “significant upside” over the coming 6 to 12 months, possibly ascending to $170,000, contingent on sustained relative appeal.

Nevertheless, distribution persists as a dominant force. Farrell indicated that major holders, or whales, have transferred substantial volumes from secure wallets to trading platforms in recent weeks, exerting relentless downward force on valuations. Analyst Engel corroborated this, noting long-term holders’ outflows have surpassed 1 million coins since June, while retail engagement trails historical norms and ETF capital infusions have tapered off markedly.

Engel assessed that although $95,000 may offer a floor, catalysts for reversal are sparse in the short term. He invoked the 2018 precedent where “Uptober” optimism dissipated, culminating in a 37% drop the following month, a cautionary tale for today’s scenario.

Broader context reveals a market grappling with intertwined forces: macroeconomic tightening via dollar appreciation, institutional deleveraging, and behavioral shifts among holders. Yet, glimmers of optimism persist through policy pivots and volatility differentials with traditional assets like gold. As Bitcoin navigates this bearish terrain under $100,000, vigilance on liquidity inflows and holder actions will be crucial for discerning reversal cues.

Fundstrat’s Farrell underscored the liquidity drought’s role in amplifying concerns, suggesting governmental reopenings could catalyze broader risk appetite. JPMorgan’s Panigirtzoglou emphasized Bitcoin’s hedging potential amid gold’s unrest, a narrative that could draw sidelined capital if macro conditions soften.

In summary, while immediate pressures dominate Bitcoin’s trajectory under $100,000, structural factors like central bank maneuvers and investor repositioning offer pathways to equilibrium. The asset’s resilience through past cycles hints at underlying strength, though current bear signals demand prudent navigation from market participants.