Bitcoin recently fell below $88,000, shedding approximately $135 million in leveraged long positions within just an hour. This decline follows a retreat from a recent weekly high that exceeded $92,000 on January 19. As of now, Bitcoin is trading at around $87,743, which reflects a daily decrease of 1.5% and a nearly 8% decline over the past week, according to CoinGecko.
What is driving this reaction in the market? Market sentiment has shifted towards fear, with the Fear & Greed Index registering a score of 25. Analysts point to a false breakout at the $95,938 resistance level as a key factor contributing to this downtrend. If no reversal signals emerge soon, Bitcoin might test the support level at $86,561, with some predictions indicating it could slide even further toward the $80,000 mark.
The global cryptocurrency market cap has now contracted to $3 trillion amid this broader selloff, impacting major altcoins like Ethereum, Solana, and XRP. In the last 24 hours, both Ethereum and BNB have dropped over 2%, while XRP and Solana experienced declines exceeding 3%.
Despite the weekend's downturn, bullish sentiments persist in the crypto community. Notably, the executive chairman of a major corporate holder of Bitcoin hinted at potential further purchases. This company currently maintains a significant holding of 709,715 BTC, which is valued at over $62 billion after last week’s acquisition.