Bitcoin Price Drops Below $86,000 Amid Mixed Institutional Sentiment
Bitcoin (BTC) has fallen below $86,000, marking five days of continuous decline as of Tuesday. Institutional investors show mixed feelings about Bitcoin. Spot Bitcoin ETFs saw large outflows, but Strategy Inc. added more BTC to its holdings. Meanwhile, better liquidity in the US might limit further price drops soon.
Institutional Investors Show Mixed Moves
- Spot Bitcoin ETFs reported a $357.69 million outflow on Monday, the biggest since November 20.
- If outflows continue, Bitcoin’s price could fall further.
- Strategy Executive Chairman Michael Saylor announced that Strategy Inc. bought 10,645 BTC for $980 million on Monday.
- This purchase follows last week’s acquisition of 10,624 BTC, showing Strategy’s strong long-term belief in Bitcoin.
Market Sentiment and Liquidity Support
- The Fear and Greed Index is at 11, indicating extreme fear among traders.
- The Treasury General Account dropped to $78 billion last week, causing a large liquidity boost.
- The US Federal Reserve is adding $40 billion through bond purchases and reinvesting $14.4 billion from Mortgage-Backed Securities into Treasury bills.
- This liquidity injection may reduce borrowing costs and support riskier assets like cryptocurrencies.
Technical Outlook: Bitcoin Faces Key Support and Resistance
- Bitcoin dropped about 7% after being rejected at a key descending trendline near $94,253.
- Support is at $85,569, close to the 78.6% Fibonacci retracement level.
- If Bitcoin closes below $85,569, it may fall toward the psychological $80,000 level.
- The Relative Strength Index (RSI) is 36, showing bearish momentum.
- The MACD indicator shows a bearish crossover, supporting the negative outlook.
- If Bitcoin recovers, it could move back toward $94,253.
