Bitcoin Price Drop: Correction or Trend Reversal?
The recent decline of Bitcoin below $90,000, a level around which it has been oscillating, raises questions about whether this sell-off is just a correction episode or the beginning of a deeper trend. Despite reaching an all-time high of over $126,000 on October 6, the cryptocurrency has experienced a significant downturn.
Market Explanations
Markets attribute this movement to macroeconomic factors, sparing the fundamentals of the digital asset. It is still considered a hedge against monetary depreciation, inflation, and long-term monetary expansion.
Turning Point
The turning point occurred on October 10, when the resurgence of trade tensions between the US and China triggered an immediate sale of risky assets in general. This is a liquidity reset, rather than a loss of confidence in the asset, as several positions were short.
Factors Influencing the Market
Hopes for a decrease in Fed rates in December are dwindling, while the shutdown of the US government, which put a pause on the publication of economic data, has also affected investor sentiment.
Outlook
In this context, it is unlikely that the decline will reverse soon. Macroeconomic instability persists and can be triggered at any time. The next reasonable entry point seems to be a bit lower, as it will likely take several months for the October levels to be reached again.
Bitcoin as a Market Indicator
Bitcoin's movements are useful for capturing the market's appreciation for real assets and, above all, liquidity. A sharp price drop accompanied by a huge volume of liquidations, as is the case, is a sign of fragile market liquidity.
Note: The original article is in French, and the translation is provided in English, using Markdown format. The content has been preserved, and the translation aims to maintain the original meaning and tone of the article.
