Market volatility intensifies, Bitcoin faces multiple pressures

At the start of 2025, the cryptocurrency market is in turmoil. Bitcoin's $100,000 mark, which became the bull-bear dividing line, broke through this high on Monday but quickly lost momentum. During Tuesday's U.S. trading session, Bitcoin fell as low as $92,600, down nearly 10% from Monday's high above $102,000 and is currently hovering near $94,000.

Other cryptocurrencies have also experienced significant pullbacks. Ethereum has fallen to $3300, Solana has dropped below $200, and altcoins are generally down about 10%. This wave of decline has even spread to the US stock market, with several leading mining companies' stock prices dropping by 5-8%.

Although the decline is relatively manageable at the moment, the market sentiment has cooled significantly as Bitcoin is close to the price at the beginning of the year. Some analysts even predict that bitcoin could fall to $70,000 ahead of a major event in the future. Analyst Ali Martinez pointed out that the current key support range for bitcoin is between $97,041 and $93,806, and if it fails to hold this range, it may fall further to $70,085.

The main reasons for this round of decline include:

1. Macroeconomic data exceeded expectations. The U.S. November JOLTS job openings and ISM services PMI were both better than expected, indicating that the job market and services sector remain strong. This may lead the Federal Reserve to maintain a hawkish stance and delay the interest rate cut timeline.

2. The Fed minutes showed that the pace of rate cuts will slow significantly in 2025, with only 75 basis points likely for the full year.

3. Increased political uncertainty. There are reports that the US president-elect is considering declaring a "national economic emergency" to pave the way for widespread high tariffs. This has raised concerns about the global economic outlook.

4. Market risk aversion is rising. U.S. stocks are fluctuating and weakening, the U.S. dollar index is climbing, and non-dollar currencies are generally declining. There is also a capital outflow from cryptocurrency ETFs.

5. Bitcoin in the Silk Road case may be liquidated. The U.S. Department of Justice was allowed to liquidate about 69,000 bitcoins, with a total value of about $6.5 billion. This potential increase in supply has raised concerns in the market.

Despite facing short-term pressure, there are still positive factors in the market outlook:

1. The latest developments regarding the Coinbase lawsuit may be beneficial for the cryptocurrency industry.

2. Personnel changes in U.S. regulatory agencies may lead to a more favorable policy environment.

3. Large investors are still actively increasing their holdings. Data shows that investors holding a significant amount of Bitcoin have demonstrated noticeable buying behavior during the recent price correction.

4. The actual impact of Silk Road Bitcoin liquidation may be overestimated. Even if all are sold, it would only take about a week to absorb given the current market liquidity.

Overall, although market sentiment has declined, the possibility of a significant crash in Bitcoin is low due to the support from institutions and large holders. The current support level is around $95,000, and in extreme cases, it may retrace below $90,000, but the likelihood of dropping to the $70,000-$80,000 range is small.

! [69,000 for sale, risk aversion surges, Bitcoin may fall to $70,000?] ](https://img-cdn.gateio.im/webp-social/moments-ae04def0f16f94fa5c472b13e3898e58.webp)

The market will next focus on the U.S. non-farm payroll report for December, which will be released this Friday. If the employment data falls short of expectations, it may prompt the Federal Reserve to adopt a dovish stance. The market anticipates an increase of 153,000 jobs in December's non-farm payroll, with the unemployment rate holding steady at 4.2%.