This week, Bitcoin fell below $90,000 due to liquidation pressure, weak ETF demand, and macroeconomic uncertainty.
This decline erased the gains from previous attempts to recover the zone between $94,000 and $95,000, marking the second major drop this month.
Market-wide forced liquidations
The catalyst was a cascading effect of forced long liquidations. Nearly $500 million was wiped out across exchanges, around $420 million in long positions were liquidated, and more than 140,000 traders were liquidated within 24 hours.
ETF flows have failed to absorb the sell-off. BlackRock's iShares Bitcoin Trust recorded over $2.8 billion in outflows for six consecutive weeks.
Inflow of U.S. ETFs dropped to just $59 million on December 3rd, signaling a decrease in institutional demand.
The macro backdrop has turned unfavorable. The Bank of Japan hinted at the possibility of interest rate hikes, threatening the liquidity that supported global risk assets through carry trade.
Traders avoided risk ahead of the U.S. PCE inflation announcement, and Bitcoin entered a cautious pattern, maintaining between $91,000 and $95,000.
Recent U.S. PCE data was largely in line with expectations, showing that core inflation is easing but still exceeds the Federal Reserve Board's (FRB) target.
The market interpreted this as evidence that inflation is continuously easing, responding cautiously to signals that it is not enough to guarantee rapid interest rate cuts.
Corporate signals have amplified fear. MicroStrategy warned it could sell Bitcoin, which caused a 10% drop in its stock price.
Rising energy costs and falling hash rates have increased miners' stress, and operators with high costs have begun liquidating BTC.
On-chain flows reflected divided sentiments. Matrixport transferred over 3,800 BTC from Binance to cold storage, suggesting accumulation by long-term holders.
However, analysts estimate that a quarter of the total circulating supply is still reporting losses at the current price.
Community, optimism amid fear
Traders on SNS discussed whether this movement is natural or manipulated. Market analysts primarily blamed excessive leverage, thin liquidity, and macro hedging.
Others pointed to long-term optimism, referencing JP Morgan's latest price model of $170,000 for 2026.
Bitcoin is currently trading near a critical inflection point. A liquidation cluster between $90,000 and $86,000 could make the market vulnerable unless new ETF inflows or macro pressures ease.
Recovery momentum will be confirmed once it moves back above $96,000 to $106,000.
Currently, volatility is dominating isolation. Bitcoin has fallen, rebounded, and fallen again, with traders watching for the next decisive move.
