Bitcoin experienced significant volatility this week, sliding to a seven-month low of $88,522 on Wednesday, only to recover above $92,000 later that night, buoyed by a robust earnings report from Nvidia. However, the cryptocurrency faced renewed pressure Thursday morning after disappointing jobs data reduced the likelihood of a Federal Reserve rate cut in December, causing Bitcoin to drop back below the $90,000 threshold by 11:05 a.m. ET.
As of now, Bitcoin is down 3.9% for the year and is on track for its most challenging fourth quarter since 2018, according to CoinGlass. “Today’s bounce is welcome but not decisive. The Fed introduced conditionality, Nvidia added optimism, and bitcoin ETFs briefly turned green, yet the structural battle remains unresolved,” said Timothy Misir, head of research at Blockhead Research Network.
Market sentiment surrounding Bitcoin remains bleak, with the Crypto Fear & Greed Index sitting at an 11, indicating “Extreme Fear.” This marks the longest period of extreme fear since the collapse of FTX, Coin Bureau noted on X. “There isn’t any near-term catalyst for BTC to pump back the remainder of this year,” stated Brian Huang, cofounder and CEO of Glider.
Analysts from CryptoQuant reported that current market conditions for Bitcoin are the most bearish observed since the current bull cycle began in January 2023. They noted that the price has fallen below its 365-day moving average, a significant technical indicator that previously signaled the 2022 bear market.
In ETF developments, Bitcoin ETFs recorded modest inflows of $75.4 million on Wednesday, which is minimal compared to the total outflows of $2.89 billion for November, as per SoSoValue data. BlackRock’s iShares Bitcoin Trust accounted for the majority of this inflow, providing some relief after a record outflow of $523.2 million seen on Tuesday.
Commenting on the situation, Nic Puckrin, cofounder of Coin Bureau, remarked on the conflicting market signals. “On one hand, we have the rapidly dwindling chances of a December rate cut by the FOMC; on the other hand, there is relief that the AI bubble isn’t set to implode, thanks to Nvidia’s forecast-beating earnings.” He pointed out a key resistance level to watch around $107,500, which represents the 50% retracement from yesterday’s low and Bitcoin’s all-time high. Conversely, he warned that if market jitters escalate into broader panic, support is strong around the $75,000 mark, which corresponds to the low from April 2025.
Armando Aguilar, capital formation lead at TeraHash, echoed these sentiments, indicating that a further decline towards the $75,000 to $78,000 range could be on the table if outflows increase and macroeconomic conditions shift toward risk aversion. However, he believes that if redemptions stabilize, Bitcoin will likely settle within the current range of $89,000 to $95,000 as the market undergoes recalibration. Aguilar suggested that a period of recalibration appears more likely than a deeper downturn in the immediate future.
