Bitcoin Stabilizes After Weekend Drop Below $75,000
Bitcoin experienced significant turbulence at the beginning of February, dipping below $75,000 on Sunday. This drop positioned it just above its 2025 low, impacted by various macroeconomic and geopolitical factors that increased risk aversion among traders. However, on Monday, Bitcoin managed a slight recovery, rising above $78,000. Nonetheless, Bitcoin closed January with a decline of 10.17%, marking its fourth consecutive monthly loss and the most significant downturn for January since 2022.
Monthly Performance and Liquidations
In February, Bitcoin’s average price stands at 12.2%. Last year, it concluded the month down 17.39%, according to CoinGlass. Over the past four days, the crypto market has seen over $5 billion liquidated, the most substantial liquidation event since October 10, which saw $19.1 billion wiped off the market.
Market Analysis
According to Timothy Misir, head of research at Blockhead Research Network, Bitcoin now trades below the True Market Mean of $80.5K and the Active Investors Mean of $87.3K. Short-term holders are currently facing significant losses, with the short-term holder cost basis at $95.4K, raising concerns about capitulation risk. The market will likely be watching the effects of Kevin Warsh’s nomination as Fed Chair, which could influence dollar liquidity expectations.
- Bitcoin’s February average: 12.2%
- January decline: 10.17%
- Liquidation amount in last four days: over $5 billion
- True Market Mean: $80.5K
- Active Investors Mean: $87.3K
ETF Trends and Investor Sentiment
Last week, Bitcoin ETFs experienced an outflow of $1.49 billion, with the iShares Bitcoin Trust accounting for a loss of $947.1 million. Nic Puckrin, co-founder of Coin Bureau, characterized Bitcoin’s start to 2023 as “abysmal,” noting that it is trading below the average ETF cost basis of approximately $84,000 for the first time since 2023. Despite these challenges, he believes that the current downturn is not extreme compared to historical reductions.
Future Outlook
Some analysts, like Vasily Shilov of SwapSpace, feel that investors are increasingly cautious, fearing a downturn similar to that seen in 2022, after the collapses of FTX and Terra. Ray Youssef, CEO of NoOnes app, warned that Bitcoin could see its price plummet to the $69,000 to $71,000 range in early 2026. He cautioned that current political decisions domestically and globally may contribute to market instability and affect investor confidence.
Looking ahead, Bitcoin is riding a wave of mixed emotions. Recent support has emerged in the $75,000 to $76,000 range, yet the main support level lies much lower at $73,000. Should prices break this critical level, analysts predict a decline potentially pushing Bitcoin below $60,000 by the end of February.
