Bitcoin traders are preparing for a significant week as the cryptocurrency approaches what could be a local bottom, following a sharp 20% drop in November. While some analysts believe the recent price recovery could mark the start of a new upward trend, others see it as only a brief pause before further declines. Currently, Bitcoin (BTC) is hovering near $87,000 after an extended 11-day sell-off that saw prices fall to a seven-month low of $80,600. On-chain data indicates that accumulation by mid-sized wallets may offer short-term support, but ongoing selling by large holders and continued outflows from spot ETFs are keeping bearish sentiment alive.
Institutional demand has remained weak, intensifying the November downturn. Last week, U.S. Bitcoin ETFs experienced $1.22 billion in net outflows, marking the fourth straight week of withdrawals. This pattern reflects broader economic uncertainty, with the Federal Reserve delaying expected interest rate cuts—currently, there is a 67.1% probability of a 25-basis-point cut in December. Political developments, such as Donald Trump’s proposal for a $2,000 stimulus check for Americans, have also contributed to market volatility, though prediction markets view the proposal as unlikely.
Technical analysis presents a mixed outlook. The daily Relative Strength Index (RSI) has climbed to 31, suggesting that bearish momentum may be slowing. Meanwhile, the MACD indicator hints at a possible bullish crossover. However, the recent formation of a "Death Cross"—where the 50-day moving average falls below the 200-day moving average—has historically signaled deeper corrections, as seen with Bitcoin’s 64% drop in 2022 and 67% decline in 2018. Experts emphasize that BTC needs to reclaim the 50-day EMA at $100,937 to confirm a lasting recovery.
Optimists point to historical capitulation patterns and institutional activity as reasons for hope. According to a Bitcoin analyst cited by Coindesk, a layered capitulation-volume model suggests that $80,000 could be a strong bottom, with a 91% probability of a 35% rebound to $118,000. This perspective is supported by Hilbert Group’s recent purchase of BTC at $84,568 as part of its long-term treasury strategy, indicating institutional confidence despite volatility. On-chain data from CryptoQuant shows that wallets holding between 10 and 1,000 BTC are accumulating, even as larger holders (1,000–10,000 BTC) continue to sell.
Nonetheless, bearish fundamentals remain prominent. Large Bitcoin deposits to exchanges have surged, accounting for 45% of inflows since October—a trend historically linked to failed support at $100,000 and $95,000. Additionally, USDT outflows from exchanges have increased, reducing liquidity for spot purchases and raising the risk of further declines. Deribit data reveals $2 billion in put options at the $80,000 strike price, representing the most bearish positioning since 2022.
Adoption trends in emerging markets add complexity to the outlook. South Africa’s top three crypto exchanges now serve 7.8 million users and hold $1.5 billion in assets, highlighting growing interest across Africa despite ongoing volatility. Meanwhile, SpaceX’s transfer of 1,163 BTC (worth $105 million) to new wallets has fueled speculation about custodial changes, though analysts attribute the move to liquidity management rather than panic selling.
The future direction for Bitcoin will likely depend on macroeconomic developments and liquidity trends. Arthur Hayes of BitMEX suggests that Bitcoin could surge to $200,000–$250,000 if the Federal Reserve steps in to stabilize financial markets, though this outcome hinges on Treasury yields and stock market performance. For now, traders are closely watching critical price levels: immediate support at $82,000–$84,000, a bearish target at $74,000, and resistance between $92,000 and $94,000.