Bitcoin Plunges to $86,000 Amid Market Fear
Bitcoin has recently experienced a significant drop to $86,000, reflecting a decline of over 1% in the past 24 hours. This drop marks a new low for both the week and the month, with the cryptocurrency trading considerably below its recent high of $92,944.
Current Market Overview
As of now, Bitcoin’s trading volume stands at approximately $87 billion. The cryptocurrency has a circulating supply of about 19,950,600 BTC out of a capped limit of 21 million. This positions Bitcoin’s market capitalization at around $1.78 trillion, which is down by 1% since yesterday.
Recent Price Movements
Earlier in the day, Bitcoin traded above the $92,000 mark but faced a sharp decline during early trading hours in the Eastern Time zone. The Bitcoin Fear and Greed Index currently indicates “Extreme Fear,” reflecting prevailing market sentiments.
Key Economic Data Impacting the Market
Economic data released by the Bureau of Labor Statistics revealed unexpected strength in the U.S. labor market for September. The report showed an increase of 119,000 nonfarm payrolls, significantly eclipsing economists’ predictions of 50,000. However, the unemployment rate inched up to 4.4% from 4.3%. This report, delayed by a government shutdown, indicates a resumption of important economic updates.
Influence of Tech Companies
Nvidia’s robust third-quarter earnings added a positive catalyst for market sentiment. The chipmaker reported $57 billion in revenue, countering fears about a possibly overstated AI market. Following these earnings, U.S. markets showed optimism, with Nasdaq futures increasing by 1.9% and S&P 500 futures rising by 1%.
Withdrawals and ETF Performance
- In the previous month, Bitcoin faced $3 billion in withdrawals from U.S. spot Bitcoin ETFs.
- However, the ETF market saw a turnaround on Wednesday, drawing $75 million in inflows.
Technical Analysis and Bitcoin’s Outlook
Last week, Bitcoin closed at $94,290, dipping below the crucial support level of $96,000. This downward trend marks a significant shift in market sentiment, as bears currently dominate price actions. Analysts have flagged the 0.382 Fibonacci retracement as the next support level, positioned between $83,000 and $84,000.
Support and Resistance Levels
If Bitcoin breaks below these support levels, the next considerable zone could fall within the range of $69,000 to $72,000. Conversely, resistance is anticipated around $98,000, with a potential short squeeze that could push prices up to $101,000. However, substantial resistance exists between $106,000 and $109,000, with further hurdles at $114,000 and $116,000.
Market Sentiment and Future Predictions
Market sentiment remains overwhelmingly bearish, especially after Bitcoin’s slide of over 25% from its October peaks. Analysts suggest that, while a temporary rally might occur, it is likely to meet strong resistance before potentially plunging to new lows.
The current Bitcoin price is $86,877, indicating ongoing volatility and uncertainty within the market.
