Key Points
- Bitcoin’s price has slipped below a critical support level, triggering over $1.3 billion in crypto liquidations.
- Whale investors are exiting the market, increasing the supply of Bitcoin on centralized exchanges.
The price of Bitcoin has dipped below its key support level in the past two days, falling to as low as $87.7K on some exchanges.
After breaking a significant support level of around $91k, Bitcoin’s price has been retesting a weak liquidity level of around $89.3K.
Technical Analysis of Bitcoin’s Price
If Bitcoin’s price consistently closes below $91k in the coming weeks, a reversal pattern will be confirmed.
This pattern, characterized by double tops around $108K and a bearish divergence of the Relative Strength Index (RSI), could potentially lead to a drop towards the next major support level of around $77k.
Impact of Bitcoin’s Price Drop
The recent volatility of Bitcoin has increased the fear of further crypto selloffs, emboldening short sellers.
As a result, over $1.3 billion was liquidated from the entire crypto market, mostly from long traders on BTC and Ether markets.
Over 362K traders were liquidated in the past 24 hours, with the largest single liquidation order involving $20 million of BTC/USDT on Binance.
Whale Investors Exiting the Market
On-chain data shows that more whale investors are taking profits to protect their capital.
In the past week, the overall supply of BTC on centralized exchanges has increased by about 17,185 coins.
The demand for US spot BTC ETFs has significantly declined in the past three weeks, with a net cash outflow on Monday of about $516 million.
However, Strategy (NASDAQ: MSTR), El Salvador, and Metaplanet Inc continue to accumulate BTC. Metaplanet recently announced the acquisition of 135 BTCs for $13 million.
Is the 2025 Bull Cycle Over?
The 2024/2025 crypto bull cycle has been complicated by the entrance of more institutional investors, nation-states, and complex regulatory frameworks.
As a result, geopolitical tensions, particularly those escalated by the US tariff wars, have heavily impacted the crypto market.
These macroeconomic uncertainties will negatively affect the global supply chain and, in turn, Bitcoin’s demand.
More institutional investors and central banks are now turning to the Gold market, which has recorded a new weekly all-time high since the beginning of the year.
The highly anticipated crypto parabolic rally in 2025 will be triggered by the return of whale investors and the potential inclusion of BTC in the US Sovereign Wealth Fund.
