Bitcoin Teetering on the Edge: A Black Friday Prelude?

Key Points

• Bitcoin has dropped below the critical $112,000 level, driven by macroeconomic worries and a $19 billion futures liquidation.
• The crypto market is entering a “reset phase,” characterized by a large-scale leverage flush, slowing ETF inflows, and increasing volatility.

Bitcoin’s value has once more dipped under the significant $112,000 mark, a price point which has previously functioned as both a support and resistance level. This decrease is due to growing macroeconomic uncertainties and a massive $19 billion futures liquidation across multiple exchanges.

According to data from Glassnode, the cryptocurrency market is transitioning into a “reset phase.” This phase is marked by a large-scale leverage flush, a decrease in ETF inflows, and a spike in market volatility. Glassnode has referred to the current state of the market as “an Early Black Friday,” indicating a time of significant discounts and market apprehension.

Bitcoin’s Current Market Situation

As of the time of writing, Bitcoin is trading around $111,000, representing a roughly 9% decrease over the past week. The drop below the significant $117,000–$114,000 cost-basis zone, which started on Oct. 10, has resulted in losses for many top buyers.

On-chain data indicates continued selling from long-term holders since July and diminished institutional interest. This is evidenced by Bitcoin ETFs recording a 2,300 BTC outflow this week. Concurrently, the futures market has undergone a significant cleanup. The Estimated Leverage Ratio has dropped to multi-month lows, and funding rates have fallen to levels unseen since the 2022 FTX collapse. These are both indicators of heavy liquidation and peak market fear.

Market Analysts’ Opinions on Bitcoin’s Future

The options market has displayed early signs of stabilization, with open interest bouncing back even as volatility surged to 76%. Short-term options remain “put-rich,” reflecting a cautious sentiment. However, some traders interpret this as the final stage of a market reset before Bitcoin’s price recovers.

Analysts like Ted believe Bitcoin could reach new highs by 2026, advising traders to view current dips as buying opportunities. He asserted that as long as the $102,000 level holds, Bitcoin will remain in a bull run. However, crypto analyst Jason Pizzino noted that a move below $108,000 puts the bull market on “thin ice.”

Despite this, he also highlighted that other assets like gold and stocks remain near record highs. This suggests that the broader economic cycle still supports long-term growth.