Bitcoin dropped to a 10-month low on Monday amid wider market volatility.
The world’s largest cryptocurrency declined by as much as 2.5 percent to $74,541, hovering close to its weakest level since Donald Trump retook the White House a little over a year ago. That previous low of $74,425 was recorded on April 7.
At the time of reporting, Bitcoin remained below the $77,000 mark. The digital asset also posted its fourth straight monthly loss in January, falling nearly 11 percent — its longest losing streak since 2018, following the collapse that came after the 2017 initial coin offering boom.
The latest downturn reflects broader financial market instability, with gold extending losses on Monday after suffering its sharpest drop in more than a decade late last week.
Smaller cryptocurrencies also traded lower, as Ether shed 4 percent and Solana declined by 2 percent. Bitcoin had surged above $126,000 last year on the back of a pro-crypto White House and rising institutional adoption, before a sharp selloff set in. Since that peak, the asset has lost about 40 percent of its value.
Data from Coinglass shows that nearly $600 million worth of bullish positions were liquidated within the past 24 hours.
Global markets weakened on Monday as risk appetite deteriorated, while precious metals continued the slump that began on Friday.
Market sentiment remains negative in the near term, with crypto assets largely mirroring broader financial markets rather than trading independently. Analysts expect Bitcoin’s near-term low to fall within the $70,000–$74,000 range, while potential upside is capped around $90,000.
Michael Saylor, executive chairman of MicroStrategy, struck a defiant tone with a “buy the dip” message. He highlighted continued accumulation by sharing a chart showing the firm’s $55 billion worth of purchases since 2020 under the banner “More Orange.” While MicroStrategy remains profitable over a five-year period, the breach of its $76,040 cost basis underscores the market’s current vulnerability.
Institutional Exodus: Negative IBIT Returns
The shift in sentiment is also weighing on institutional investors. BlackRock’s iShares Bitcoin Trust (IBIT), the largest spot Bitcoin ETF globally, has reached a troubling point. According to Unlimited Funds, the overall dollar-weighted position of investors in IBIT has now turned negative.
The “average” dollar invested in the fund is currently losing value due to heavy inflows during Bitcoin’s rally toward $90,000, even though early 2024 investors are still in profit. This development aligns with a reported $1.1 billion weekly outflow from Bitcoin funds, as investors rotate into “debasement trades” such as gold, which recently added $2.2 trillion in market value in a single session.
Bitcoin’s Outlook
From a technical standpoint, analysts say the “bull market” structure has suffered significant damage. The breakdown below the $80,700 “true market mean” is widely viewed as a key turning point. Even more concerning is the crossover of the 21-week and 50-week Exponential Moving Averages (EMA).
This bearish signal last appeared in April 2022, shortly before the severe downturn later that year. Bitcoin’s failure to hold above the November low of $82,000 has further weakened its bullish foundation. Current price action is being interpreted as either a macro ending diagonal or a corrective “C” wave, both suggesting further downside before a durable bottom is formed.
The Bear Case:
Analysts identify $60,000 as the primary downside target, representing a full distribution of the current “triangular” breakdown and aligning with earlier Fibonacci projections. If broader bearish conditions persist, deeper liquidity levels could extend toward $49,180.
The Bull Case (Relief):
Some optimism remains in the CME Group futures market, where a daily gap around $84,000 is seen as a potential magnet for price action. Many traders expect Bitcoin to close this gap in the “next few weeks,” possibly triggering a short-term relief rally before another test of lower support levels.
Ultimately, Bitcoin must reclaim the $80,500 level to serve as the “safe trigger” for bullish momentum. Until then, the market remains cautious, awaiting clearer signals on institutional demand and U.S. Federal Reserve policy.