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Bitcoin dropped hard Tuesday. The world’s biggest cryptocurrency fell below $66,000 for the first time in weeks, hitting an intraday low of $65,312 during early trading sessions. Markets didn’t like what they saw.
The selloff marked Bitcoin’s second straight day of losses, and traders are getting pretty nervous about where prices head next. Standard Chartered’s analysts think Bitcoin could tumble all the way to $50,000 based on technical charts and recent market action. Some bears are calling for even steeper drops to $40,000, though that’s probably extreme. Trading volumes spiked during the decline, with both buyers and sellers jumping into the action. The volatility that’s defined crypto markets for weeks just won’t quit.
Things look murky right now.
Standard Chartered issued a report on February 11 warning about Bitcoin’s slide. “We’re seeing technical indicators that suggest more selling pressure ahead if Bitcoin can’t hold above key support levels,” the bank’s crypto team said. They’re watching the $60,000 level closely – if that breaks, the drop could get ugly fast. The report came just hours before Tuesday’s selloff began, and traders took notice.
Mike Novogratz, the Galaxy Digital CEO who’s been bullish on Bitcoin for years, tried to calm nerves during a Tuesday interview. He said corrections like these are normal and often create buying chances for smart money. “Short-term pain, long-term gain,” Novogratz said. “I’ve seen this movie before.” But his confidence didn’t stop the selling.
Ethereum fell alongside Bitcoin, down about 4% as risk-off sentiment spread across crypto markets. The broader digital asset space is feeling the heat, with most major coins trading in the red. Altcoins got hit even harder than Bitcoin, which isn’t surprising given their higher volatility.
JP Morgan’s strategists jumped in with their own take on February 12. They said institutional demand has cooled recently, but any major price drop could bring big buyers back to the table. “Corrections often create entry points for institutions that missed earlier rallies,” the team wrote. That’s the hope, anyway.
Regulatory worries keep hanging over the market too. Global regulators have been making noise about tighter crypto oversight, and that uncertainty weighs on prices. Nobody knows exactly what new rules might look like or when they’ll hit.
Binance moved fast to protect its users. The exchange announced new risk management rules on February 13, including higher margin requirements and tighter stop-loss settings. “We’re adapting to current market conditions to keep our traders safe,” a Binance spokesperson said. Other exchanges are probably watching to see if they need similar moves. More on this topic: Robinhood and eToro Stocks Plunge as.
Retail interest hasn’t disappeared despite the volatility. Robinhood reported more account openings as individual investors try to time the market. “We’re seeing people who want to buy the dip,” the trading platform’s spokesperson said Tuesday. That’s classic retail behavior – buying when prices fall.
And institutions? Grayscale said it won’t change its Bitcoin strategy despite the recent selloff. The digital asset manager, which runs one of the biggest Bitcoin investment trusts, is sticking with its long-term approach. “We’re not making knee-jerk reactions to short-term price moves,” Grayscale’s team said.
Coinbase saw trading activity surge as Bitcoin bounced around. The exchange reported a big jump in user activity on February 11, with both retail and institutional clients making moves. “Volatile periods like these often drive engagement,” Coinbase’s chief economist said. Translation: people love to trade when prices swing wildly.
Goldman Sachs analysts are watching Bitcoin’s 200-day moving average closely. Their February 12 report called it a “critical support level” that could determine where Bitcoin goes next. Technical traders live and die by these levels, so it matters. The 200-day average sits around $63,000 right now.
But the selling pressure feels real. Crypto Twitter is full of bears calling for lower prices, and momentum traders are probably adding to short positions. When sentiment turns negative in crypto, it can stay that way for weeks.
Nobody’s sure what comes next. Bitcoin’s notorious for surprise moves in both directions, and catching the exact bottom is basically impossible. The $60,000 level that Standard Chartered mentioned could be key – break below that and $50,000 becomes realistic pretty fast. Related coverage: Bitcoin Crashes Toward K as Traders.
Market makers are keeping spreads tight despite the volatility, which means liquidity is still decent. But if panic selling kicks in, that could change quickly. The crypto market moves fast when fear takes over.
Trading desks across Wall Street are probably watching this closely. Bitcoin’s recent correlation with traditional risk assets means a crypto crash could spill over into stocks. That’s the last thing markets need right now.
The February 12 close below $66,000 sets up an interesting test for Bitcoin bulls.
The Federal Reserve’s upcoming policy decisions add another layer of uncertainty to Bitcoin’s outlook. Interest rate expectations have shifted dramatically in recent weeks, with traders now pricing in fewer cuts this year than previously anticipated. Higher rates typically hurt risk assets like crypto, since investors can earn better returns in safer government bonds.
Meanwhile, the Bitcoin ETF market shows mixed signals despite the price decline. BlackRock’s IBIT fund saw net outflows of $87 million on February 12, while Fidelity’s FBTC recorded $43 million in redemptions. However, several smaller ETFs actually posted inflows, suggesting some institutional buyers view the dip as an opportunity. The ETF landscape remains fragmented, with different funds experiencing vastly different flows during volatile periods.
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