Bitcoin continued its decline on Friday, dropping more than 24% from its record high above $126,000 reached in October. The world’s largest cryptocurrency briefly fell below $95,000 during the session before recovering slightly to trade above $96,000.
The fall came as global markets faced a sharp sell-off. Investors remain uncertain about when the Federal Reserve will cut interest rates, and that uncertainty is putting pressure on risk assets, including cryptocurrencies.
New data showed that bitcoin exchange-traded funds (ETFs) saw their second-largest daily outflows on Thursday. The token has also struggled since last month’s steep drop, which was caused by leveraged liquidations and selling from major long-term holders.
Research firm 10X Research said there is currently “no meaningful marginal buyer” supporting the market. The company noted that several on-chain signals now point to Bitcoin being in a “bear market regime.” It also warned that if Bitcoin falls below $93,000, it could slide even further.
Analysts say interest rate decisions will play a key role in Bitcoin’s direction. Without a rate cut in December or more dovish signals from the Fed, 10X Research does not expect a near-term rally.
Fundstrat strategist Sean Farrell also took a cautious view. He said Bitcoin is facing weak momentum and lacks major catalysts. He added that the longer-than-expected government shutdown delayed any boost from federal spending.
Farrell believes that a drop into the low-$90,000 range may be needed to reset valuations and bring new buyers back into the market.
