Friday morning in Asia and my phone wouldn’t stop buzzing. One notification after another: Bitcoin -5%, -7%, -9%. By the time I rubbed the sleep from my eyes, the price had already punched straight through $90,000 like it was made of paper. I’ve been through plenty of crypto drawdowns, but this one felt different – colder, faster, merciless.
By 8 AM UTC, Bitcoin was kissing $85,400. A seven-month low. For anyone who bought anywhere near the top a few weeks ago, that’s a 32% haircut in what feels like the blink of an eye. And the really scary part? The bleeding might not be over yet.
What Actually Just Happened to Bitcoin?
Let’s be brutally honest – this wasn’t some mysterious black-swan event. This was a textbook long squeeze on steroids, combined with a painful reality check for everyone who thought spot ETFs would make Bitcoin immune to gravity.
Over the past 24 hours alone, more than $443 million in bullish futures positions got liquidated across exchanges. For context, shorts lost a measly $26 million. That imbalance tells you everything: the market was extremely one-sided, and the moment momentum flipped, there was no one left to buy the dip.
I keep thinking about those traders who were 50x leveraged at $100k+ just days ago. One quick 10% move and their entire account vanished into thin air. Crypto remains the wild west, and leverage is still the fastest way to turn six figures into zero.
The ETF Dream Is Fading – Fast
Remember when spot Bitcoin ETFs were supposed to bring in endless institutional money and push us comfortably past $150k? Yeah… about that.
This week the twelve U.S. spot Bitcoin ETFs recorded $1.45 billion in net outflows. Do the math and November is already down more than $3 billion. Two months ago we were celebrating $7 billion inflows like the bull market would never end.
In my experience, ETF flows are the single best real-time sentiment indicator we have right now. When Wall Street is buying, retail tends to follow. When Wall Street quietly heads for the exits, retail gets absolutely steamrolled – exactly what we’re watching unfold.
“The continued outflows and sharp price drop have stoked widespread fear among investors.”
And fear is putting it mildly. The Crypto Fear & Greed Index has been parked at 14 – literally “Extreme Fear” – for nine straight days. That’s the kind of reading you normally only see at major cycle bottoms.
Why Now? The Perfect Storm Nobody Saw Coming
Several things collided at exactly the wrong moment:
- The October euphoria evaporated almost overnight
- Odds of a December Fed rate cut collapsed
- Trump’s tariff threats spooked global risk assets
- Everyone was maximally leveraged long after the run to $126k
- ETF buyers suddenly turned into sellers
Pick your poison – they all hurt. But the leverage and the ETF reversal were the two knives that actually drew blood.
Where Is Support? The Levels Everyone Is Watching
Right now the big question on every trader’s mind is simple: where does this stop?
Here are the levels I’m personally staring at:
- $80,000 – $77,000: the next major demand zone and 61.8% Fibonacci retrace of the entire move up from the 2024 lows
- $74,000: previous all-time high from March 2024 – psychological round number + high volume node
- $64,000 – $68,000: absolute worst-case zone where the 200-day moving average cluster lives
Some analysts are already pounding the table that $80k is the line in the sand. Others think we’re going much lower before real buyers step in. Honestly? Both sides have a point.
Are We in a Bear Market or Just a Healthy Correction?
Here’s where I’ll probably upset some people: this doesn’t feel like 2022… yet.
Yes, the price action looks ugly. Yes, sentiment is in the toilet. But the macro backdrop is still wildly different. We have a pro-crypto administration coming in, institutional infrastructure is orders of magnitude more mature, and global liquidity conditions are still accommodative.
That said, markets can stay irrational far longer than most of us can stay solvent. If ETF outflows accelerate and we break $80k cleanly, the technical damage will be severe and could easily take us toward the mid-60s.
“This kind of slow, steady decline with small bounces is the worst type of chart structure. The downtrend is likely to continue.”
– Market analyst Georgii Verbitskii
Harsh, but hard to argue with right now.
What History Tells Us About Crashes This Size
Let’s zoom out for a second. Bitcoin has seen 30%+ drawdowns in literally every bull market. It’s not a bug – it’s a feature.
Some quick reminders from past cycles:
- May 2021: -35% in two weeks → new ATH five months later
- June-July 2021: -50% drop → new ATH three months later
- November 2021 – June 2022: -77% bear market (different macro)
The 2021 examples all happened with far less institutional involvement and far worse global conditions. Today we have actual adults in the room – pension funds, publicly traded companies, sovereign nations – who aren’t going to panic sell at the first sign of trouble.
Or at least that’s what I keep telling myself at 3 AM while staring at red candles.
The Silver Lining Almost Nobody Is Talking About
Here’s the part that actually keeps me calm: every single time Bitcoin has flushed out this much leverage, the next leg up has been explosive.
Over-leveraged longs are the fuel that feeds violent short squeezes later. Once the weak hands are gone, there’s literally no one left to sell. That’s when the real money starts buying with both fists.
We saw it in 2020 after the Covid crash. We saw it in 2023 after FTX. And we’ll probably see it again once this washout is complete.
How I’m Positioning Right Now (And What I’m Telling Friends)
Full disclosure – I’ve been taking some chips off the table above $100k over the past couple weeks. Not because I turned bearish, but because protecting capital is rule number one.
That said, I’m keeping plenty of dry powder and getting ready to deploy aggressively if we see capitulation volume around these lower levels. My personal shopping list starts getting interesting below $82,000 and becomes downright exciting under $78,000.
If you’re new to crypto or highly leveraged right now – just zoom out. Breathe. This is normal. The people who lose everything are the ones who panic at the bottom and sell to the people who stayed calm.
Final Thoughts: Pain Today, Potential Tomorrow
Look, nobody enjoys watching their portfolio get cut by a third in a week. But crypto has never been about getting rich slow. It’s about surviving the drawdowns so you’re still around for the next parabolic move.
The fundamentals haven’t disappeared overnight. The ETFs aren’t going anywhere. Trump still loves Bitcoin. The halving cycle is still in its early innings. All the ingredients that got us to $126,000 are still there – they’re just taking a breather while the market shakes out the tourists.
Is the worst coming? Maybe. Probably another 10-15% downside wouldn’t shock me at this point. But is this the end of the bull market? I’m not betting on it.
Stay safe out there. Manage your risk. And remember – the best opportunities always show up when it feels like the world is ending.
See you on the other side.
