- Bitcoin’s price fell sharply over the weekend, dropping below $78,000 to its lowest level since April.
- Key bearish technical indicators, like a monthly MACD crossover, suggest the potential for a deeper, multi-month correction.
- Options market activity shows traders are now betting billions on a price drop below $75,000, abandoning bullish $100,000 calls.
- Analyst Eric Crown warns Bitcoin could fall to the $50,000-$60,000 range before finding stability, calling recent optimism “hopium.”
Bitcoin plunged below $78,000 this weekend, hitting its lowest price since April as profit-taking and a lack of fresh buyers overwhelmed thin market liquidity. Traders reported the rally, once fueled by corporate demand from entities like MicroStrategy, has now run out of steam.
Consequently, markets became vulnerable to forced selling and derivative liquidations. This decline fits a broader bearish pattern that analyst Eric Crown has highlighted for months, arguing that optimism for new highs is misplaced “hopium” for bulls.
He posts market updates on the crypto market to a large audience. Meanwhile, the options market echoes this pessimism, with traders piling into bets for a drop below $75,000.
The notional value of put options at that level on Deribit now nears $1.2 billion. This almost matches the value of call options betting on a rise to $100,000.
Crown points to several technical alarms, including a bearish monthly MACD crossover in November. Additionally, a weekly EMA crossover and a yearly “shooting star” candlestick pattern signal potential medium-term reversal.
Making matters worse, bitcoin has diverged from traditional risk assets like equities since October. Crown sees this as classic late-cycle behavior where investors “sell the more speculative assets first.”
Beyond charts, the speculative wash-out from October’s crash left traders wary of re-entering. While not predicting a cycle end, Crown suggests bitcoin may fall to the mid-$50,000s before stabilizing.
He frames this as a potential value-accumulation phase for long-term positions. The current market weakness, therefore, may represent a necessary correction rather than a definitive collapse.
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