Warning Signals: Bitcoin 365-Day Moving Average At Risk of Collapse

The cryptocurrency market is currently facing significant bearish pressure, with Bitcoin (BTC) struggling to reclaim previously crucial support ￰0￱ data from CoinGecko indicates that Bitcoin has retraced nearly 6% over the past week, a decline that has impacted other major cryptocurrencies, including Ethereum (ETH), XRP, Binance Coin (BNB), and Solana (SOL), all of which have experienced double-digit losses during the same ￰1￱ Digital Lowers Bitcoin Price Target This downturn marks a stark contrast to the bullish sentiment observed earlier in October, when Bitcoin surged to record its current record high slightly above the $126,000 mark due to a wave of margin buying.

However, the euphoria was short-lived, as approximately $20 billion in leveraged positions across the crypto market were abruptly liquidated just days later on October 10, contributing to the ongoing lack of confidence among ￰2￱ Novogratz’s Galaxy Digital recently revised its year-end Bitcoin price target down to $120,000, a significant cut from the previous estimate of $185,000, attributing this adjustment to the “significant leverage wipeout.” Related Reading: Weakness In Major Cryptos: What Key Technical Metrics Indicate For Bitcoin, Ethereum, And Solana Market analytics firm CryptoQuant has pointed out that Bitcoin’s drop below its 365-day moving average near $102,000 could signal a deeper ￰3￱ moving average has historically acted as a critical support level during this bull cycle, and its failure to hold could lead to a more substantial correction in Bitcoin’s ￰4￱ their analysis, CryptoQuant experts elaborated on the conditions necessary for Bitcoin to reverse its current trajectory and potentially reach new all-time ￰5￱ observed that Bitcoin led a global risk-off movement, testing the critical $100,000 support ￰6￱ decline was influenced by a stronger dollar and ongoing uncertainties regarding Federal Reserve (Fed) policy, which have dampened broader risk appetites across various asset classes.

Notably, there have been four consecutive sessions of approximately $1.3 billion in net outflows from US spot BTC ETFs, reversing what had been one of the strongest tailwinds for the market in ￰7￱ diminished demand in the spot market has coincided with forced deleveraging, resulting in over $1 billion in long liquidations at recent lows, which briefly breached intraday support before dip buyers stepped ￰8￱ Of ETF Flows Crucial The options market has further intensified volatility, as dealers remain net short gamma around the $100,000 strike, leading to increased hedging activity near this critical ￰9￱ $100,000 mark now stands as a psychological barrier, and any stabilization in ETF flows could shift market sentiment, provided no new macroeconomic shocks ￰10￱ the macroeconomic front, the analysts assert that the current environment remains supportive, albeit clouded by the ongoing government shutdown in Washington.

However, policy clarity remains ￰11￱ Reading: Ethereum Price Needs To Reclaim This Key Level To Prevent Drop To $1,700 The Federal Reserve’s recent 25 basis point cut in October, which included some dissenting opinions, was accompanied by a cautious tone that pushed back against expectations for another cut in ￰12￱ are currently pricing in a 60-65% chance of a follow-up move, but as the Fed’s blackout period continues, policymakers may become more comfortable with the idea of pausing, which would help maintain a firm dollar and tight credit ￰13￱ Bitcoin to break higher sustainably, CryptoQuant’s analysis suggests that a reversal in exchange-traded fund outflows and renewed confidence in risk assets will likely be ￰14￱ image from DALL-E, chart from ￰15￱