• Bitcoin plunged below $70,000, hitting its lowest level since November 2024 amid a broader crypto market downturn.
  • The sell-off triggered $775 million in liquidations, with technical indicators signaling oversold conditions despite bearish momentum.
  • Analysts warn of potential further declines to $68,000 or lower if support fails, citing hawkish Fed policy and fading institutional demand.

Bitcoin tumbled below the critical $70,000 threshold on Thursday, dropping as much as 4.6% to $69,271 in a sharp continuation of recent selling pressure. The cryptocurrency has now shed approximately 45% from its October 2025 peak, with the broader market experiencing three consecutive sessions of declines. According to people familiar with trading activity, weak volumes and sustained selling are pushing investors to exit positions at losses, even as technical indicators like the 14-day RSI near 26 suggest oversold conditions.

Thursday's slide followed a major liquidation event on February 1—dubbed "Black Sunday II" by some traders—that wiped out $2.2 billion in positions, the largest single-day loss since October 2025. This latest sell-off triggered an additional $775 million in liquidations across cryptocurrency derivatives markets, with approximately 165,000 traders, predominantly holding long positions, facing margin calls. Efforts to stabilize the market have hit a snag, with ETF inflows drying up and reducing institutional bid support, according to analysts monitoring fund flows.

Market participants point to shifting monetary policy expectations as a key driver. Kevin Warsh's appointment as Federal Reserve Chair has fueled anticipation of more aggressive balance sheet reduction and hawkish measures, making risk assets like cryptocurrencies less attractive. The U.S. Dollar Index (DXY) surged above 97.5, adding further pressure on crypto valuations. Without a turnaround in sentiment, Bitcoin could test lower support levels, analysts warn.

Technical outlooks are grim in the near term. Bitcoin is trading well below its critical moving averages—under the 50-day SMA near $89,000 and the 200-day SMA around $103,500—indicating a strong bearish trend. Analysts identify $68,000, the 200-week exponential moving average, as a crucial support level where initial demand might emerge. If that fails, ultra-bearish scenarios target $52,000 or even $47,824, based on Fibonacci extensions and historical patterns cited by figures like Peter Brandt and Michael Burry. "We're seeing hallmarks of capitulation," one technical analyst said, requesting anonymity due to firm policies. "The path forward hinges on whether $68,000 holds or if we see further capitulation."

The downturn has spilled over to altcoins. Ethereum fell to $2,068, its lowest since May 2025, with technical analysis suggesting potential declines to $1,725 or lower in February. XRP crashed over 7% below $1.40, and Dogecoin broke important support levels, raising risks of more downside. Despite the bleak short-term picture, some models offer a glimmer of hope: the Bitcoin Rainbow Chart, a logarithmic valuation tool, projects Bitcoin could trade between $120,000 and $160,000 by late February 2026 if it reverts to long-term trends rather than speculative extremes. From current levels, that implies substantial recovery potential without entering bubble territory.

Attempts to reach major crypto exchanges for comment were unsuccessful as of press time. Market conditions remain fluid, with futures markets in a forced deleveraging phase and investor sentiment fragile. The ultimate outcome will likely depend on broader macroeconomic factors and whether key technical supports can stem the selling tide.