Bitcoin slide below $78K sparks liquidations; analyst warns of further downside toward $50K–$60K
Bitcoin fell below $78,000 over the weekend, its lowest level since April, triggering a wave of liquidations as profit-taking met thin liquidity and fewer fresh buyers. Traders said corporate demand that had supported the recent rally (notably purchases by MicroStrategy) has waned. Options market positioning shifted bearish: put open interest at the $75,000 strike on Deribit reached about $1.159 billion, nearly matching the $1.168 billion notional open interest at the $100,000 calls. Former NYSE Arca options trader Eric Crown, who has warned since October that bitcoin is in a sideways-to-downside phase, highlighted multiple technical bearish signals — a November monthly MACD down-cross, a bearish weekly 21/55 EMA crossover, and a 2025 yearly chart “shooting star” — and suggested BTC could fall further into the mid-$50,000s to low-$60,000s. Crown views that range as a potential accumulation zone once speculative leverage is washed out. For traders, the key takeaways are elevated liquidation risk, increased demand for downside protection in options, and technical indicators consistent with multi-month corrective risk.
Bearish
The article signals a clear bearish outlook. Price fell below $78,000 with forced liquidations and thinner liquidity, a typical setup for extended downside pressure. Options positioning shows large put interest at $75K nearly matching bullish call exposure at $100K, indicating traders are hedging or betting on further falls. Technical indicators cited by Eric Crown (monthly MACD down-cross, weekly 21/55 EMA bearish crossover, yearly ’shooting star’) have historically preceded multi-month corrections. Similar past episodes — e.g., major post-rally declines accompanied by elevated leveraged liquidations and growing put interest — produced protracted drawdowns before stabilization (traders exited via washouts, then accumulation at lower ranges). Short-term impact: heightened volatility, elevated liquidation risk, and greater demand for downside hedges (puts, reduced leverage). Long-term impact: potential redistribution if BTC reaches mid-$50K to low-$60K and institutional/long-term buyers re-enter; however, until technicals and options skew improve, downside risk remains dominant. Trading implications: reduce directional leverage, prefer hedged/defined-risk positions, monitor put-call open interest and EMAs for signs of trend reversal.