Bitcoin drops below $105,000 due to pressure from US banks

The key takeaways

• As auto-sector bankruptcies revealed risky loans and financial stocks fell, the US regional banks were under pressure.

• Bitcoin has fallen below its 200-day SMA to just $104,500 in the face of $1.2 billion worth of crypto liquidations.

• Analysts see $88,000 as the second significant level of support for BTC if $104,000 doesn’t hold. 

BitcoinBTC() fell to $104,000 during a second Black Friday as signs of stress in the US regional banking system triggered another wave of fear on the cryptocurrency market.

Bitcoin extends losses as equities slide

Bitcoin began to drop during New York’s trading hours Thursday, as investors became defensive. Equities were down, bonds up, and a combination of both. gold reaching a fresh all-time high.

It came shortly after fears of a financial crisis in the US erupted, as regional banks were under stress due to their exposure to the failures of two automobile companies. 

Related: Investors are getting better at spotting bad Bitcoin treasuries: David Bailey

First Brands Group of Ohio, an auto parts distributor with liabilities in excess of $10 billion, and Tricolor Holdings – a subprime car lender indebted to the tune $1 billion – both filed for bankruptcy at the end September. 

This failure exposed the risky practices of lending in particular on private credit markets. Fears about contagion were triggered by this. 

Zions stock fell 13% when it announced that the company would incur a loss of $50 million in its third quarter due to two loans made by California. Western Alliance shares fell by 11% as it filed a lawsuit against CantorGroup V, Inc. for fraud.

As a result, the S&P 500 dropped by 0.63% to close the day at 6,629.07 on Thursday, while the Nasdaq composite index declined by 107 points (-0.47%). Dow Jones Index lost 0.65% on Thursday to finish the day at 45952.24.

Data from WalletHub shows that this panic has spread into the cryptocurrency market. Bitcoin fell to an intraday price of $104,500. Total crypto market capitalization also dropped by 5% at $3.58 trillion. Cointelegraph Markets Pro You can also find out more about the following: TradingView. 

Bitcoin’s value plummets below $100,000

Bitcoin’s decline on Friday has extended its deviation from the Oct. 6, 2016 high. all-time high of $126,000 Liquidations on the derivatives’ market were massive, with a 16.5% drop.

Related: Bitcoin OG whales to blame for BTC’s painful rise: Willy Woo

Bitcoin accounted for 317,8 millions dollars of the $935.2 Million in liquidated long positions. Ether (also known as Ether) is a cryptocurrency.ETHLong liquidations accounted for $196.3 Million.

The figure shows that a total amount of 1,19 billion dollars was lost on both short and long trades.

“Another day with a lot of liquidations across the board. It’s not even just longs while the market has been going down,” said trader Daan Crypto Trades on Friday, adding:

“This is exactly what happens after most big flushes. Traders chop themselves up while trying to make back what’s lost.”

According to CoinGlass, additional data shows that Bitcoin prices are eroding liquidity at around $105,000. However, as the graph below illustrates more orders remain at $103,500.

The price of Bitcoin could drop to even lower levels in this range and sweep away the available liquidity before experiencing a long-term recovery.

How low will Bitcoin prices go?

Bitcoin’s drop below $105,000 On Friday, it lost key areas of support, such as the 200-day SMA, which was $107,520.  

The traders are now speculating on how low BTC will fall before finding its feet. 

“No reversal in sight at the moment for $BTC,” Analyst Block_Diversity Post X in a comment. 

The accompanying chart highlights key levels that traders should be watching on the daily chart. These include the low of last Friday on Binance, which was around $101,000 and the demand zone around $95,000 to $88,000.

“These are open targets, unless $BTCstarts getting support at $107.4K.”

“$104K is the HTF level that matters most right here,” said Sykodelic added, “We expect that the area will hold because the daily RSI now is at its lowest since the bottom of $74,000.”

“The weekly close this week will be very important.”

You can also read about the advantages of using Cointelegraph reported, with the crypto Fear & Greed Index at yearly lows and at “extreme fear,” BTC’s price could rebound from the current level in a short time.

The article is not intended to provide investment advice. Each investment or trading decision involves some risk. Readers should do their own research before making any decisions.