Bitcoin price has fallen over 30% from its yearly high, largely impacted by geopolitical and economic concerns that deteriorated investor appetite for risk assets.
Summary
- Bitcoin price has dropped over 30% from its yearly high amid geopolitical tensions and persistent macroeconomic pressure weighing on risk assets.
- Bernstein analysts expect market weakness to persist until Q1 earnings, with crypto-linked stocks down sharply but potentially nearing a bottom.
- Bearish technical indicators point to further downside risk toward $60,000, while a move above $69,000 could signal a shift in momentum.
After rallying nearly 12% to a yearly high of $97,538 on Jan. 15, the bellwether crypto has fallen by nearly 31% to $67,525 at the time of writing. This came amid several geopolitical and macroeconomic concerns that have largely risen due to U.S. President Donald Trump’s tariff drama that has extended into the beginning of this year, followed by the start of a war in the Middle East against Iran that has led to repercussions in energy and financial markets across the globe.
The hawkish stance the Federal Reserve has maintained as a result has also not helped the situation.
According to analysts at Bernstein, the resulting volatility has left stocks tied to crypto markets, including exchanges, brokerages, and tokenization platforms such as Coinbase, Robinhood, and Figure, down nearly 60% from their recent highs. This represents a big discount considering that these businesses have continued to expand their operations despite the turbulence.
In their Monday note to clients, they predicted that the current market weakness will extend until the release of first-quarter earnings reports, at which point a market bottom could potentially form. Such a prediction suggests that Bitcoin could likely continue to see more downside at least until April ends.
On the daily chart, Bitcoin (BTC) price has lost the support of a key descending trendline where bulls have often previously found footing.
Technical indicators such as the MACD and RSI show that bears still have the advantage in the current setup. The MACD lines have formed a bearish crossover and were trending downwards while the RSI line was moving within a descending channel, both signs that selling pressure remains dominant.
For now, $65,000 could serve as the key psychological support which bulls would seek to defend. If Bitcoin falls sharply below this key level, bears could aim to drag it all the way down to its yearly low around $60,000 once again.
On the contrary, if BTC price rebounds above $69,000, which aligns with the 23.6% Fibonacci retracement level, it could signal a shift in momentum.
Bullish outlook on crypto-linked stocks despite downturn
While the recent report projected trimmed price targets for crypto-linked stocks, Bernstein analysts maintained “outperform” ratings for Coinbase, Robinhood, and Figure as they attributed the recent weakness to macro pressure and deteriorating market sentiment rather than fundamental business failures.
This means that following the expected weak quarter, they expect these companies to come out stronger in the long term, likely as Bitcoin retraces back to its former highs once all the drama from the ongoing U.S.-Iran war settles down.
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