While Bitcoin bulls were busy dreaming of endless green candles, reality came crashing down hard. Bitcoin plummeted below $87,000 on Tuesday, marking a brutal 20% decline from its January peak of $109,000. The carnage didn’t stop there – crypto markets witnessed a staggering $1.6 billion in liquidations within 24 hours. So much for those $150K predictions.
Dreams of eternal gains met harsh reality as Bitcoin crashed 20%, wiping out $1.6 billion in a single bloody day.
The perfect storm hit crypto markets from multiple angles. A hack at Bybit rattled already nervous traders, while the strengthening Japanese yen sparked risk-off sentiment across markets. The long/short ratio has approached near equilibrium levels, suggesting an imminent directional breakout. Add in disappointing U.S. consumer confidence numbers and a broader tech stock selloff, and you’ve got yourself a recipe for disaster.
Technical analysts are having a field day with this one. Bitcoin smashed through critical support at $89,000 like it was made of paper, with the next major support level lurking around $85,000. The 200-day moving average sits at $82,000, but liquidation data shows potential pain points between $68,000 and $77,000. Ouch.
Institutional players aren’t exactly rushing to the rescue either. Bitcoin ETFs recorded a net monthly outflow of approximately $644 million – the largest exodus since their January 2024 launch. The past two days saw massive long liquidations totaling nearly $331 million, highlighting the severity of the market downturn. Some market watchers are holding their breath for a billion-dollar outflow day before even considering buying the dip. The decentralized nature of Bitcoin’s global blockchain network makes it virtually impossible for any single government to shut down the cryptocurrency completely.
The sentiment shift has been dramatic. The Crypto Fear & Greed Index plunged into “extreme fear” territory, quite the change from the euphoria of just weeks ago. Even Standard Chartered analysts are warning against catching this falling knife.
Still, long-term holders seem unfazed, viewing this as just another day in crypto.
Looking ahead, analysts have adjusted their short-term outlook, with many eyeing the $80,000-$85,000 range as potential stabilization points. But here’s the kicker – despite the current bloodbath, most maintain their long-term bullish stance.
Because in crypto, today’s catastrophe is tomorrow’s “healthy correction.” Time will tell if they’re right or just high on copium.
