Bearish view
- Sell the BTC/USD pair and set a take-profit at 88,750.
- Add a stop-loss at 95,000.
- Timeline: 1-2 day.
Bullish view
- Buy the BTC/USD pair and set a take-profit at 95,000.
- Add a stop-loss at 88,750.
Bitcoin price has been in a strong freefall in the past few months, a trend that has accelerated this week. The BTC/USD pair plunged from the year-to-date high of 126,300 in October to below 91,000.
Bitcoin price has dropped and erased all the gains it made earlier this year despite the ongoing political clarity, institutional support and Wall Street support. Its market capitalization has now plunged by over $600 billion from the November high.
The crash has coincided with the ongoing decline in the Crypto Fear and Greed Index, which has dropped to the extreme fear zone of 16, its lowest level since April this year when Donald Trump announced his reciprocal tariffs on all countries.
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Bitcoin has also dropped as exchange-traded funds (ETF) outflows rise. All spot Bitcoin ETFs shed over $1.2 billion in assets last week, a trend that has continued this week. Data compiled by SoSoValue shows that BlackRock’s IBIT now holds about $74 billion in assets, down from nearly $100 billion earlier this month.
Meanwhile, most Bitcoin treasury companies, except for Michael Saylor's Strategy, have stopped buying as their stocks have plummeted into a bear market. Strategy surprised market participants by announcing that it acquired 8,178 coins for $835 million last week.
Looking ahead, the BTC/USD pair will react to the upcoming Federal Reserve minutes on Wednesday. These minutes will provide more information about what to expect in the coming meeting. This is notable because the falling odds of a Fed cut in its December meeting is one of the top reasons why the BTC/USD pair has crashed this week.
BTC/USD Technical Analysis
The daily timeframe chart shows that the BTC/USD pair has crashed in the past few months, moving from a high of 126,275 in October to a low of 91,900 today.
Bitcoin price has already moved below the important level at $107,275, its lowest level in August and the neckline of the double-top pattern.
The coin formed a death cross pattern as the 50-day and 200-day Exponential Moving Averages crossed each other. This pattern often leads to more downside as it is usually a sign of short-term momentum.
The BTC/USD pair has remained below the Supertrend indicator, a sign that bears are in control. Therefore for the pair will likely continue falling as sellers target the next key support level at 88,790, its highest level in March.
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