By Joseph Adinolfi and Frances Yue
The pioneering cryptocurrency is on the cusp of a bear market, data shows
Bitcoin is down nearly 20% from its record high of $126,272.76 in early October.
Bitcoin prices retreated below $100,000 for the first time since June on Tuesday, bringing the pioneering cryptocurrency to the cusp of a bear market, Dow Jones Market Data showed.
The largest cryptocurrency (BTCUSD) briefly traded as low as $99,982 before recouping some losses and bouncing back to $101,269, according to FactSet data. It was down 19.8% from its record high of $126,272.76 on Oct. 6, but still up 8.5% year to date. An index or asset is considered to be in a bear market after a drop of 20% or more from a recent high.
Bitcoin was off by more than 5% on the day in recent trading, leaving it on track for its biggest one-day drop since April 3, Dow Jones Market Data showed.
The selloff in cryptocurrencies like bitcoin has coincided with a loss in altitude for other popular momentum trades. Gold (GC00), small-caps and quantum-computing stocks like Rigetti Computing Inc. (RGTI) were also coming under pressure on Tuesday.
“People are in the gold trade, people are in the uranium trade, people are in the quantum computing trade, people are in the small-cap trade,” said Ram Ahluwalia, chief investment officer at Lumida Wealth. “They’re all rising and falling together.”
Ahluwalia said that while bitcoin is technically on the cusp of a bear market, veteran crypto investors have endured much larger drawdowns over the years. “For people who are seasoned in this asset class, this isn’t a big deal. I think this is just a shakeout.”
The roots of the selloff can be traced back to the October Federal Reserve meeting, he said. The central bank announced an interest-rate cut on Oct. 29, its second this year. But during the press conference that followed, Fed Chair Jerome Powell expressed some uncertainty about another reduction in December. This has been bad news for bitcoin, Ahluwalia explained, since lower rates typically help juice speculative assets like cryptocurrencies.
Katie Stockton, founder and managing partner at Fairlead Strategies, pointed out earlier this week that bitcoin had broken below its 200-day moving average, suggesting that there could be more downside ahead in the near term. Her technical analysis suggested that the next reliable support level for bitcoin would be around $94,200.
If bitcoin continues to trade at or around its current price, it would mark its lowest 4 p.m. level since June 22, when it traded at $98,923.77. The crypto was on track for its worst three-day stretch since Oct. 11, a period when it fell by 9.9%.
-Joseph Adinolfi -Frances Yue
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11-04-25 1538ET
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