Bitcoin Drops Below $78K as Analysts Warn of Extended Downtrend

Bitcoin fell below $78,000 over the weekend, its lowest level since April, sparking fresh liquidations as liquidity thinned and new buyers remained scarce.

Traders told CoinDesk that rallies once driven by corporate demand, particularly Strategy’s (MSTR) Bitcoin purchases, have lost momentum, leaving markets vulnerable to forced selling and derivative liquidations.

Saturday’s slide fits a broader bearish trend. Eric Crown, former NYSE Arca options trader, has maintained since late October that Bitcoin is in a sideways-to-downside phase, warning that hopes for a return to new highs—or a rotation from metals back into crypto—are misplaced “hopium” for bulls.

“It’s been my view since the end of October that BTC is in a sideways and downside phase… I do not think 80K is a macro low for Bitcoin,” Crown, who shares market updates with over 200,000 subscribers, told CoinDesk.

Options market activity supports this bearish outlook. Traders increasingly bet on Bitcoin falling below $75,000 while abandoning $100,000 call positions. On Deribit, $75,000 puts now hold $1.159 billion in open interest, nearly matching the $1.168 billion tied to $100,000 calls.

Technical indicators reinforce caution. The monthly MACD crossed down in November, historically preceding extended downturns. The weekly 21 vs. 55 EMA recently turned bearish, signaling potential multi-month losses, and the 2025 yearly chart closed as a “shooting star,” a pattern often indicating medium-term reversals.

Bitcoin has diverged from traditional markets since October, falling while equities held steady — a late-cycle risk-off pattern. “People generally sell the more speculative assets first,” Crown noted.

The fallout from October’s $19 billion crash, which wiped out many leveraged altcoin positions, has left traders hesitant to re-enter.

Crown suggests Bitcoin could decline further, potentially into the mid-$50,000 to low-$60,000 range, before stabilizing. He frames this zone as a potential opportunity for long-term accumulation rather than an end to the crypto cycle.