The bears are fighting back, with key support for BTC around 88,000

Author: BitpushNews

On Tuesday, the cryptocurrency market continued its correction trend.

According to Bitpush data, Bitcoin faced continuous pressure after reaching a high of $95,000 in the early session. In the afternoon, bulls attempted to rebound but encountered bearish resistance at $94,800, briefly dropping below $91,000. At the time of writing, Bitcoin was trading at $91,646, down 2% in the last 24 hours. The altcoin market performed even weaker, with over 90% of the top 200 tokens by market capitalization recording losses.

The current overall market capitalization of cryptocurrencies is $3.14 trillion, with Bitcoin's dominance at 57.3%.

In the U.S. stock market, the S&P, Dow Jones, and Nasdaq indices all closed higher, rising by 0.57%, 0.28%, and 0.63%, respectively.

The decline may be due to an overheated leveraged market

Part of the reason for Bitcoin's decline may be the excessive leveraged trading in the market. When market fluctuations occur, these leveraged trades can be forcibly liquidated, leading to further price declines.

Data analysis platform IntoTheBlock expressed a similar view, stating that Bitcoin's correction "can be attributed to" the rise in funding rates, ultimately leading the market to lean bearish. However, as funding rates return to normal ranges, further leveraged liquidations should be limited.

Cryptocurrency futures market analyst Byzantine General pointed out that, in terms of trading volume, Bitcoin's current price trend is similar to some previous local tops. He stated, "At this time, Bitcoin is likely to experience a period of sideways consolidation. However, during this period, some other cryptocurrencies may perform well."

From a technical perspective, Bitcoin may test the liquidity area near the psychological level of around $90,000 again, and it could even drop further to $85,000.

This is because Bitcoin rose very rapidly between November 6 and November 22, without a significant imbalance between buying and selling. Such rapid increases are usually accompanied by subsequent corrections to balance supply and demand. Therefore, Bitcoin may retrace to previous support levels or lower to digest the earlier gains.

Additionally, with the Relative Strength Index (RSI) falling below 50 for the first time since November 6, it is expected that sellers will dominate price movements in the coming week, which may lead to Bitcoin prices consolidating below $95,000 for a period.

Cryptocurrency research analyst CoinSeer believes that the important support for Bitcoin is in the $85,000-$88,000 range, and a drop below this level could trigger large-scale cascading liquidations.

TradingView analyst TradingShot wrote: "Yesterday's significant correction in Bitcoin caught the market off guard. There are several fundamental reasons behind this: first, the excitement after the elections is gradually fading, and second, the psychological pressure from the $100,000 level. However, there is a more important technical reason that has been overlooked."

Analysts pointed out: "As shown in the chart, there has been a Fibonacci channel in the past three cycles (including the current cycle). This channel began with a strong rebound when the top was formed in December 2013. The top of that cycle coincided with the 0.236 Fibonacci level, which has blocked upward movements in the bull markets of June 24, 2019, and May 11, 2024."

TradingShot stated that the recent correction occurred because Bitcoin touched "the first real resistance of the bull market cycle."

He explained: "This is the Fibonacci trend line that blocked the rise recently (on November 22). We can call it 'the first real resistance of the bull market cycle' because this is the first major resistance level encountered before the bull market cycle ultimately peaks. In the past two cycles, the highs appeared at the 0.0 Fibonacci level, which is the top of the channel (red circle in the chart). The red dot at the end of 2025 is not a prediction, just for comparison."

TradingShot also observed: "The duration of each bull market cycle in the past has been about 150 weeks (1050 days). If this pattern repeats, the peak may occur at the end of September or early October."

He noted: "Trying to catch the peak and sell is much better than giving a specific price. Interestingly, although BTC is technically facing resistance, the current uptrend began from the low on August 5, 2024, right at the 1-week MA50 (blue trend line). Technically, as long as this trend line remains valid, the cyclical bull market wave should be able to stay intact."