According to crypto analyst “Daan Crypto Trades”, Bitcoin is currently at a critical technical level that should be defended to stop major losses.
He was referring to the 0.382 Fibonacci retracement zone, which serves as a key support and resistance area during market cycles.
“I believe this can be a key area for bulls to defend,” he said, noting that a break below could see Bitcoin (BTC) fall to April lows around $76,000.
“It can also be just about the last major support before a retest of the April lows, which might break this high timeframe market structure.”
Late Sunday, Bitcoin was hit by one other short leverage flush, with leveraged positions on either side liquidated. The asset briefly fell below $88,000 before quickly recovering above $91,500.
“This is one other example of low liquidity weekend manipulation to wipe out each leveraged long and short positions,” commented “Bull Theory.”
BTC is trading in a key support/resistance zone. Source: Daan Crypto Trades
All eyes are on this week's Fed meeting
The Federal Open Market Committee's monetary policy meeting on Tuesday and Wednesday will end with a choice on rates of interest, with a 0.25% cut widely expected.
Crypto markets have lost momentum since October's rate cut as Fed Chair Jerome Powell “signaled a non-linear, data-dependent easing path relatively than a transparent cycle,” said Markus Thielen, head of 10x Research, in a note shared with Cointelegraph.
He added that the market now expects a 25 basis point rate cut on December 10, followed by a cautious tone “that may reflect the hawkish implementation in October and maintain mild pressure through the top of the 12 months.”
“With volumes already down and ETF flows negative, upside participation stays low while BTC holds the $70,000-$100,000 range and implied volatility continues to say no, making downside risk more pronounced than upside risk.”
The Fed's outlook might be crucial
Apollo Capital's Henrik Andersson echoed this sentiment, telling Cointelegraph that a Fed rate cut this week is already priced in, but the important thing to market direction might be the forecast statement. He remained cautiously optimistic for the subsequent 12 months.
“However, with the Fed Chair replaced in May next 12 months, we’re prone to see further rate cuts in 2026, which needs to be positive for risk assets, including cryptocurrencies.”
Nick Ruck, director of LVRG Research, agreed, telling Cointelegraph that along with the Fed meeting, upcoming labor and inflation data releases “could unleash renewed liquidity inflows and spark a broader market recovery in the event that they are consistent with expectations of further monetary easing.”
