Bitcoin falls to a seven-month low below $90,000

The outlook for the crypto market has continued to deteriorate day by day Bitcoin fell below $90,000 on Tuesday morning for the first time since April.

Amid the sell-off, Bitcoin is down 4.5% over the past 24 hours, according to data from CoinGecko, likely due to recent moves from Mt. Gox Wallets. According to Arkham data, approximately 185.5 BTC, worth $16.8 million, were transferred.

However, the recent uptick in buying pressure has provided impetus Bitcoin’s price rose 2% in the past five hours, recovering from an intraday low of $89,368 to $91,474. The total market capitalization of all cryptocurrencies fell 20% from $4 trillion on October 14 to $3.2 trillion on Tuesday.

The market is entering the ‘risk management’ phase

Adding to the pressure on the market decline, market sentiment is deteriorating, partly caused by reduced institutional demand.

Spot Bitcoin ETFs have seen outflows of $2.59 billion in November, nearly matching February’s total of $3.56 billion.

Similarly, last week’s spot Ethereum ETFs saw net outflows of $728.57 million, the third largest, following May’s $787.74 million decline and September’s $795.56 million, according to SoSoValue data.

The exodus of capital from exchange-traded funds comes as the “market shifts from a momentum phase to a risk management phase,” Shivam Thakral, CEO of Indian crypto exchange BuyUCoin, told me. Declutter.

Beyond the macroeconomic uncertainty, “profit protection from earlier-in-the-cycle funds and portfolio rebalancing, following crypto’s exceptional rally against traditional assets since 2023,” are two key catalysts driving the outflows, according to Thakral.

“Institutions are not exiting because of negative long-term sentiment,” the expert added, when asked whether these bearish ETF-driven flows will continue. “They are responding to a lack of catalysts, slowing ETF inflows and a temporary shift to risk-off positioning.”

Macro clarity remains key in restarting the recovery and quashing the possibilities of a bear market, according to Shivam and experts we spoke to earlier Declutter.

How Low Can Bitcoin Go?

While Bitcoin may move lower, “the downside still appears relatively limited,” Thakral said

If bearish flows continue, Bitcoin could revisit the $82,000 to $85,000 range, the expert added, suggesting this area is where “both the long-term holder cost base and ETF inflow clusters sit.”

The odds of Bitcoin reaching $115,000 before $85,000 have fallen from 66.7% on November 13 to 25% on Tuesday, according to data from prediction market Myriad. (Disclaimer: Myriad is owned by Declutter‘s parent company Dastan)