Bitcoin dropped to $62,000 before rebounding to about $65,360, a gain of roughly $3,000. The recovery followed a 16% decline over three trading days, one of the steepest short-term drops of the year.
Bitcoin has now fallen almost 30% from its recent high near $87,000. As recently as November 5, the token was trading around $81,000.
Why Bitcoin Fell So Hard
Gareth Soloway, chief market strategist at Verified Investing, sees several forces driving the sell-off:
- The AI trade: Bitcoin’s roughly 30% decline is similar to Nvidia’s drop from its all-time high. Many of the funds and institutions that own Bitcoin also hold large positions in Nvidia and other AI stocks, so risk aversion in tech is spilling over into crypto.
- Margin calls: Investors facing losses in AI stocks may be selling Bitcoin to meet margin calls in their stock accounts. That adds selling pressure largely unrelated to crypto itself.
- Weekend trading: Much of the plunge happened over the weekend, when trading volumes are thin. Large institutions are mostly absent on Saturdays and Sundays, making price swings larger and leaving retail investors to drive more of the selling.
- Wider losses: Nvidia, gold and silver are all near 52-week lows, adding to retail investors’ anxiety.
Soloway also cited the upcoming Anthropic IPO as a potential drain on market liquidity. According to Soloway, there has been no major news suggesting that anything fundamental has changed for crypto.
The $66,000 Floor Gave Way
The $66,000 to $67,000 range had been expected to provide support. Bitcoin traded sideways in that zone for weeks earlier this year, and the heavy trading there created a concentration of buyers and sellers. Such levels often slow a decline.
Fear drove the price below that range and down to $62,000. In a panic, prices rarely turn around at an exact level and often fall past support before finding a bottom. A decline of about 5% below a major level is within the normal range for a fear-driven sell-off.
Bitcoin Price Levels to Watch
If the rebound continues, these are the key levels to watch:
- $66,000 to $67,000: The former support zone, which is now the first area the price needs to reclaim.
- $70,000: The first major hurdle. Reaching this level would put the rebound about 13% above the low.
- $75,500: The bigger test. This was key support before the breakdown and is now strong resistance, where sellers could reappear.
- $62,000: The new floor. A decisive break below it would leave the recent low without support and could pave the way for another leg down.
Leverage Remains the Biggest Risk
The crash has again hit highly leveraged traders hard. Soloway warned that traders using 100x leverage or more are most exposed in moves like this. Exchanges and large players tend to push prices toward clusters of leveraged positions, triggering liquidations.
What Comes Next for Bitcoin
Market sentiment has turned fearful, and extreme fear has often coincided with short-term rebounds in the past. In the near term, the direction depends on whether Bitcoin can stay above $62,000 and climb back through $66,000 to $67,000.
A rebound to $70,000 to $75,500 would be a relief rally within a broader downtrend. Any longer-term move toward $80,000 to $90,000 or higher remains uncertain and would likely depend on how Nvidia and the wider AI trade perform.
