Crypto markets have recently fallen to their lowest prices in three months and turned most of the winnings after Trump’s US presidential victory. Bitcoin had held up relatively well until the level of $ 92,000, which had been supported since November 2024, was broken. The price then quickly dropped to $ 80,000 where it found support.
Sentiment in the crypto market has been weakened, as denoted by the Crypto Fear and Greed Index, which has dropped from a level of 55 (neutral) to as low as 10 (extreme fear) in the last month. It is currently at 34.
Crypto’s high connection with traditional markets means that Bitcoin and wider crypto -active prices have also been affected by the uncertainty of tariffs and what they could mean for the US economy in the near future.
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Furthermore, crypto-specific events, such as the fall of the recent citybet exchange hack, have been described as the largest crypto-heist in history, and registration of outflow from Spot Bitcoin ETFs, also contributed to the recent fall in crypto-active prices.
The recent message from Trump that the United States would move forward with the creation of a strategic cryptor reserve gave a boost to crypto asset prices, with Bitcoin gathering up to the $ 95,000 price level. However, despite Trump promising to store Bitcoin and other crypto assets, it is not entirely clear how such a reserve will work, how it can benefit taxpayers and if there will be future crypto -active purchases. This uncertainty has caused a withdrawal in the price of Bitcoin, currently at about $ 90,000.
In my opinion, we are now on a crossroads. Solving financial conditions can mean crypto assets and wider risk prices go higher from here. US Finance Minister Scott Bessent recently confirmed the administration’s plan to reduce interest rates to help fight Americans. However, additional noise about tariffs or crypto reserve plans that do not meet society’s expectations can cause Bitcoin’s price to fall further. We will have to see which story turns out to be stronger over the coming weeks and months.
Generally, we see Retracs at 20-35% in Bitcoin Bull markets before a base is found and the next leg higher begins. The $ 80,000 level that the price of Bitcoin recently declined is a 28% decrease from $ 109,300 all the time, so there’s a chance we may have already seen the low.
On the other hand, if the price was to fall further due to the above grounds, a 35% decrease from the festive height would set the price of $ 70,000 before there is a base that is potentially forming and the next leg higher begins.
While I understand that investors may feel scared due to the big price movements, retro dents in the price of any asset class or instrument are normal and expected, and we must remember that we are still marked from this time last year.
Investors with clear cash and who have a long -term conviction in Bitcoin can see this as an appropriate time to add further to their overall inventory.
