Understanding the Recent Bitcoin Price Movements
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The Recent Bitcoin Price Decline
On Friday, Bitcoin’s price experienced a significant dip, falling below $105,000 and hitting its lowest point in 15 weeks. This decline revisited support levels initially tested during the prior week’s tariff-induced selloff.
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Currently, Bitcoin faces weakened short-term momentum due to its inability to maintain a position above the $112,000–$116,000 range. As a result, its price is constricted between a demand zone of $104,000–$107,000 and a strong resistance band near $120,000–$124,000, which marks its previous all-time high.
Technical analysis indicates that Bitcoin has interacted with its 200-day moving average for the first time in half a year. Meanwhile, the 20- and 50-day moving averages are trending downward, signifying a cooling phase after a steep rally.
Examining Bitcoin’s Current Support and Resistance Levels
Despite the recent drop in Bitcoin’s value, data from derivatives markets suggests a “controlled deleveraging,” rather than a panic-induced selloff. Open interest has returned to mid-year levels, and funding rates have turned negative, signaling that speculative long positions have been unwound.
Spot market activity remains relatively stable, indicating that long-term investors are largely unfazed. If bullish traders can reclaim the $110,000–$113,000 range, we may see a relief rally towards $116,000–$120,000. However, if Bitcoin falls to $104,000–$106,000, traders may anticipate a further decline to $101,000–$102,000, with some projecting a rapid drop to $98,000–$100,000 if liquidity diminishes.
Impact of Macroeconomic Factors
Several macroeconomic factors have contributed to Bitcoin’s recent price movement. Renewed stress on U.S. regional banks, reminiscent of events in 2023, has led to risk-averse behavior, coinciding with escalating U.S.–China trade tensions.
In contrast, gold has reached new highs, attracting investors seeking safe-haven assets as cryptocurrencies experience a downturn. Market sentiment suggests a possible Federal Reserve rate cut during the upcoming meeting in late October and early November, which could ease financial conditions and potentially support a crypto market recovery in the fourth quarter. Conversely, a hawkish stance from the Fed would likely prolong the current consolidation phase.
Bitcoin ETF inflows have slowed from their previous record pace, with specific U.S. crypto funds reporting net outflows as investors adopt a more cautious approach. Despite this, the long-term investment thesis remains robust, supported by ETF accessibility, institutional adoption, and a limited Bitcoin supply. Many analysts view this recent dip as a healthy correction following October’s exuberance.
Performance of Altcoins and Bitcoin’s Market Dominance
Altcoins have underperformed as capital shifts towards Bitcoin and stablecoins. Major cryptocurrencies like Ethereum (ETH), Binance Coin (BNB), Solana (SOL), and Ripple (XRP) have experienced declines of 7-12% in a single day, while high-volatility tokens such as Dogecoin (DOGE) and Cardano (ADA) have seen steeper weekly losses. Historically, Bitcoin’s market dominance tends to increase until its price stabilizes and risk appetite returns among altcoin investors.
Key price levels to monitor include Bitcoin’s support at $104,000–$106,000 and $101,000–$102,000, with resistance at $110,000–$113,000, $116,000, and $120,000–$124,000. A sustained close above $120,000 would reaffirm the upward trend and refocus attention on achieving new highs. Until then, analysts expect Bitcoin to remain within a range, influenced by catalysts and macroeconomic factors, as leverage stays low and the market continues to assess broader signals.
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