Bitcoin, XRP, Solana, Ether Slide as BTC Loses Last Support Before $100K

Bitcoin BTC$107,661.53 it fell below a key support level that had halted a slide toward $100,000, amid weakening momentum in tech stocks.

The leading cryptocurrency fell below $106,000 during Asian trading hours, breaking through a level that had offered support several times in recent weeks, according to CoinDesk data.

The breakdown shifts the focus to the $100,000-$101,000 area, according to Markus Thielen, founder of 10x Research. A breach here could open the door to a deeper test near $94,000, or even a full retracement toward $85,000, the maximum pain zone that also lines up with strong support in the chain, Thielen said in a note to clients.

“While such a move would be extreme, downside risk remains contained as long as bitcoin remains above its prevailing downtrend line,” he added.

BTC price action follows declining chances of rapid Fed rate cuts and signs of a bullish turnaround in the dollar index, which tracks the value of the greenback against major currencies.

In addition, there are signs of overexuberance in the so-called “Magnificent 7” stocks – Apple, Microsoft, Alphabet, Amazon, Nvidia, Meta, and Tesla – which are typically seen in the main tops of the market.

“The put-call skew in the Mag7 complex reversed for the first time since December last year (ie the implied volatility of calls traded on puts). This phenomenon happened only a few times. The move implies that investors are over-positioned for continued upside,” analyst Neil Sethi told X, citing Goldman Sachs.

“Historically, such low-sloping readings have tended to coincide with short-term consolidations or reversals such as peaks of optimism,” Sethi added.

At the same time, the Oracle-linked credit default swap, which measures the cost of insurance against a potential default, rose after the company’s huge third-quarter AI investment disclosure – reaching levels not seen outside of periods of significant macro stress.

This, according to some analysts, represents investor anxiety regarding the AI ​​spending boom. Since 2023, AI optimism has been one of the main drivers of the bull market in stocks and broader risk assets, including cryptocurrencies.

All things considered, bulls may be better off being cautious rather than overly exuberant.