Bitcoin’s recent plunge toward $74,500 has ignited a fierce debate regarding the sustainability of the bull cycle, showing that the bitcoin market trend relies too heavily on concentrated capital. According to analyst Arslan Butt, this 13% weekly drop not only breached the $80,000 support but also revealed a significant stagnation in new institutional inflows.
The massive correction, which took the price to nine-month lows on February 2, 2026, was catalyzed by Kevin Warsh’s nomination as the next Fed Chair. This event triggered a “risk-off” rotation, strengthening the US dollar and pressuring digital assets amid expectations of tighter monetary policies. Consequently, the lack of retail demand left the market vulnerable to a cascade of high-leverage liquidations in a short window.
CryptoQuant data reinforces this thesis by showing a flatlined “Realized Cap,” indicating that recent growth was driven by speculation rather than genuine capital entering the ecosystem. Even the holdings of MicroStrategy, the largest corporate holder, were briefly underwater when the ethereum price today and Bitcoin’s price fell below their respective institutional average cost basis levels.
What technical levels will define the future of Bitcoin’s price?
Despite the prevailing pessimism, indicators like the RSI in oversold territory suggest the market might be nearing a necessary capitulation point for a recovery. However, to invalidate the bearish thesis, Bitcoin needs to reclaim the $80,700 zone and break above the 50-day moving average dynamic resistance. Otherwise, the bitcoin market trend could seek deeper liquidity pools near the $70,800 mark.
On the other hand, long-term investors view this pullback as a strategic buying opportunity, trusting that the asset remains undervalued relative to its fifteen-year trajectory. Therefore, the stabilization of ETF flows and the absorption of profit-taking will be crucial in determining whether this adjustment is a technical reset or the definitive end of the accelerated growth cycle.
Ultimately, the survival of the bullish case will depend on the ability to attract new liquidity that does not solely rely on a few corporate players. While macroeconomic uncertainty persists, investors should closely monitor realized capitalization data, as the leading cryptocurrency continues to seek a balance between its store-of-value narrative and its extreme sensitivity to US central bank decisions.
