Why Did Bitcoin Fall Again After the Wall Street Open?
Bitcoin slid back below $72,100 on Wednesday after the US trading session opened, extending losses and revisiting levels last seen in late 2024. Data from TradingView showed BTC/USD dipping to just under $72,500 on Bitstamp, undercutting Tuesday’s prior low and erasing a brief recovery attempt.
The move followed a short-lived rebound that pushed prices above $76,000 earlier in the week. That bounce failed to hold, leaving traders focused on downside levels as selling pressure re-emerged during US hours.
Weakness was not limited to crypto. Broader macro assets struggled at the same time, with US equities opening lower and precious metals giving back recent gains. Gold failed to reclaim the $5,000 level as support, reinforcing a risk-off tone across markets.
Investor Takeaway
Macro Backdrop Offers Little Support
Market participants pointed to fading macro momentum as a key factor behind the renewed pressure. Trading firm QCP Capital said crypto volatility remains elevated even as some political risks temporarily recede.
“Crypto remains volatile,” QCP Capital wrote in its latest Asia Color update. The firm noted that the US government’s avoidance of a shutdown had reduced immediate headline risk but warned that fiscal uncertainty had not disappeared.
“In macro, the shutdown overhang has faded, but the key takeaway is how quickly fiscal standoffs can return. Homeland Security funding was only extended through 13 February, keeping another deadline risk in play,” QCP added.
That backdrop has left markets cautious. Without a clear macro tailwind, Bitcoin has struggled to attract sustained buying interest during periods of weakness, particularly during US trading hours.
Traders Focus on Lower Long-Term Levels
Among Bitcoin traders, sentiment remained defensive as price action continued to deteriorate on higher time frames. Some pointed to heavy sell volume accompanying each leg lower as a warning sign.
“Ugly interim weekly candle for bulls. IF we close sub 74k – its safe to say 50k area is next,” trader Roman wrote in a post on X. “Notice how volume is high every time price moves down. That tells us when volume comes in – its selling AKA bear market price action!”
Others shared similar views, with some traders preparing for another drop of $10,000 or more if the current structure fails to hold. While short-term relief bounces remain possible, many are treating them as opportunities to reduce exposure rather than signs of a trend change.
Attention has also turned to longer-term technical reference points. The 200-week exponential moving average, currently near $68,000, has been mentioned as a potential area where buyers could show stronger interest if losses continue.
Investor Takeaway
Derivatives Data Shows Elevated Stress
Derivatives markets reflected the ongoing pressure. Data from CoinGlass showed a buildup of long liquidation levels just above $72,000, adding to the risk of further forced selling if price continues lower.
Total crypto liquidations over the past 24 hours climbed above $800 million, highlighting how quickly leverage has been flushed during recent declines. Such spikes often coincide with sharp intraday moves, especially when liquidity thins during key trading sessions.
While large liquidation events can sometimes precede short-term stabilization, traders remain cautious about calling a bottom. With macro assets under pressure and Bitcoin failing to reclaim broken support levels, many are choosing patience over prediction.
What Traders Are Watching Next
In the near term, traders are watching whether Bitcoin can stabilize above the low $70,000s or if selling accelerates toward the mid-to-high $60,000 range. A sustained move back above $76,000 would be needed to alter current expectations, but recent attempts have failed quickly.
Until broader markets regain momentum or crypto-specific demand improves, Bitcoin appears vulnerable to further tests of long-term support zones.
