FX168 Financial News Agency (Europe) reported on Tuesday (November 4) that risk-averse sentiment impacted cryptocurrencies, with Bitcoin, the world’s largest cryptocurrency, hitting its lowest level since June.
(Source: FX168)
During the Asian trading session, Bitcoin once broke below a key technical support level under USD 106,000, a level that had previously acted as a short-term defense multiple times. As momentum in technology stocks weakened, market sentiment turned significantly bearish.
According to data from CoinDesk, Ethereum (Ether) simultaneously dropped to its lowest point since August, with key moving averages showing a ‘death cross’ signal, indicating increasing downward momentum; Ripple (XRP) fell to a three-week low.
Technical Analysis: A break below USD 100,000 may test the range between USD 94,000 and USD 85,000.
Markus Thielen, founder of 10x Research, noted in a client report that Bitcoin’s current technical breakdown has shifted market focus to the range between USD 100,000 and USD 101,000.
“If this range is breached, prices may further retest USD 94,000 or even fully retreat to the USD 85,000 area – a region considered the so-called ‘maximum pain zone,’ which also coincides with strong on-chain support.”
Thielen added, “Although this scenario represents an extreme case, as long as Bitcoin remains above the current downtrend line, overall downside risks remain manageable.”
Macro Factors Pressure: Expectations of Fed Rate Cuts Diminish, Stronger Dollar Suppresses Risk Appetite.
Analysts pointed out that the weakness in Bitcoin is partly due to macro headwinds: a decline in expectations for rapid interest rate cuts by the Federal Reserve, coupled with a technical rebound in the US Dollar Index (DXY). The strengthening of the dollar has put pressure on dollar-denominated risk assets, including cryptocurrencies and growth-oriented tech stocks.
Since 2023, the AI investment boom has not only driven US equities and tech stocks to historic highs but also fueled an upward trend across a broad range of risk assets, including cryptocurrencies. However, as AI investment enters a saturation phase and liquidity expectations tighten, the market may now be facing a “reality check”—the high valuation ranges of technology and crypto assets could be entering a phase of cyclical adjustment.
