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Bitcoin rebounds to $87,000, but the market remains in extreme fear

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Bitcoin rebounds to $87,000, but the market remains in extreme fear

Bitcoin staged a tentative recovery after a wave of liquidations and selling, rising to about $87,900.

15-minute BTC/USDT chart on Binance. Source: TradingView.

At the time of writing, the price had eased to $86,900 (+1.1% over 24 hours), according to CoinGecko.

On November 21 the price fell to around $82,000. Major altcoins followed suit. Ethereum rose to $2,834 (+0.5%), XRP to $2.09 (+2.65%), and Solana to $133 (+2.5%). Total market capitalisation increased by 1%.

Analysts describe the move as a technical bounce. Vincent Liu, chief investment officer at Kronos Research, expects consolidation between $85,000 and $90,000. He noted thin liquidity and fragmented flows. Long-term holders continue to accumulate as the market looks for a footing.

Sentiment remains uneasy. The Fear and Greed Index sits at 19, only slightly above the weekly low.

Source: Alternative.me.

BTC Markets analyst Rachel Lucas called the current correction the deepest of the cycle. The price’s ability to hold above $86,000 is constructive, she said, but still “fragile”.

To confirm a local bottom, bitcoin needs to establish itself above $88,000. Failure risks a slide toward $80,000.

Short-term traders remain cautious and watch funding rates. According to Lucas, institutional investors are rotating capital rather than exiting positions. She linked outflows from ETFs to risk management, not a loss of interest in the industry.

Outflows from spot bitcoin ETFs

Over the past week, US spot bitcoin ETFs saw $1.22bn in redemptions, the fourth consecutive week of outflows.

Source: SoSoValue.

Monthly net outflows reached $4.34bn. Only on November 19 did the funds record an inflow of $75.47m, and on November 21 an inflow of $238.47m. On the remaining days investors continued to withdraw money.

Source: SoSoValue.

BlackRock’s IBIT suffered the largest losses — $1.09bn for the week. It is the fund’s second-worst result on record. On November 18 the product posted a record single-day outflow of $523.15m.

Source: SoSoValue.

Key levels have shifted

Glassnode analysts published updated readings for key on-chain metrics.

With spot at $86,500, the key levels line up as follows:

WeRate co-founder Quinten François noted the market’s technical backdrop.

He said the digital gold flashed its strongest oversold signal since it traded at $25,000.

Charles Edwards, founder of Capriole Investments, pointed to hefty flows. Over the weekend, 165,000 BTC was withdrawn from Coinbase.

The reason for the shift is unknown, but he noted that the last comparable outflow occurred right after the collapse of FTX, when bitcoin traded around $16,000.

Crypto analyst Ted Pillows offered a gloomy outlook. He noted that bitcoin is about to close its second consecutive weekly candle below the 50-week moving average.

In 2018 and 2022, such a pattern was followed by another 50% drop. In his view, the only way the market avoids a decline is a “complete breakdown” of bitcoin’s customary four-year cycle.

In November, Bitwise’s chief investment officer, Matt Hougan, said that bitcoin was “closer to a bottom than to the start of a pullback”, though a move to the lower end of the $70,000–$80,000 range remained possible.

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