Bitcoin hits six-month low near $95,000; analysts optimistic for bullish turn
Bitcoin dropped to a six-month low near $93,000 due to tight liquidity, but analysts expect a near-term bullish reversal.Summary
Bitcoin recently fell to a six-month low, trading near $93,000 on Sunday before recovering slightly, primarily driven by tightening liquidity, exacerbated by the U.S. government shutdown keeping the Treasury General Account elevated. This strain, which some analysts compare to conditions in late 2018 and 2019, also contributed to bearish sentiment regarding interest rate cuts and led to $1.1 billion flowing out of U.S. spot bitcoin ETFs last week.
Despite the current price action and the Crypto Fear & Greed Index signaling "extreme fear," analysts remain optimistic. They anticipate the liquidity headwind will reverse as government spending resumes and delayed payments are processed. Furthermore, potential stimulus from Japan could boost global liquidity. Experts view the pullback as a reflection of funding conditions rather than a fundamental break in crypto.
Key technical support for Bitcoin is cited between $88,000 and $91,000, though analysts are closely watching the 50-week simple moving average around $103,000; a sustained close below this level would be a bearish signal. Altcoins are currently lagging as they require excess liquidity and euphoric sentiment to thrive, neither of which is presently available.
(Source：The Block)