Bitcoin (BTC) is down 7.0% this week to
$89,188, recovering slightly from Tuesday’s low of $86,019. The cryptocurrency
has erased half of its Trump-driven rally that began on November 5, with recent
declines fueled by U.S. President Donald Trump’s renewed commitment to imposing
tariffs on Mexico and Canada next week after a 30-day delay.
The broader market is also under pressure.
S&P 500 futures fell 3.6% since last Thursday, driven by Walmart’s (WMT)
weak Q1 2025 guidance and disappointing services PMI data. Bitcoin initially
held steady last week, losing only 0.6%, as investors hoped for a gradual
economic slowdown that might push the Federal Reserve (Fed) toward rate cuts.
However, Trump’s recent comments and weak consumer confidence data have
increased market jitters, pushing BTC to test the $88,000–90,000 support zone.
Spot Bitcoin ETFs saw significant outflows,
with $539 million exiting in a single day on Monday, bringing total weekly
losses to $1.2 billion. If BTC fails to hold above $88,000, it could decline
further to the $78,000–80,000 range. Standard Chartered’s head of crypto
research, Geoff Kendrick, anticipates a further 10% drop before Bitcoin resumes
its climb toward the $150,000–200,000 target. A sharp drop in U.S. Treasury
yields could signal an upside reversal.
A critical market event to watch is Nvidia’s
(NVDA) Q4 2024 earnings report on Wednesday. While expectations are high, any
weak forward guidance—particularly due to DeepSeek issues—could trigger market
volatility.
Large investors remain cautious. Spot Bitcoin
ETFs, including BlackRock’s IBIT, Fidelity’s FBTC, and Grayscale’s GBTC,
recorded $160.85 million in net outflows last week, improving from $278.59
million the previous week. This could indicate a wait-and-see approach from
institutional players.
Despite the current sell-off, long-term BTC
price targets remain at $150,000–200,000 by mid-2025, driven by U.S. Bitcoin
reserves and potential Fed rate cuts. However, no immediate catalysts for a
reversal are evident yet.