Bitcoin Drops by 4% as S&P 500 Retreats on Equities Selloffs
Bitcoin (BTC) fell 4.13% to $81,162 on Thursday, underperforming a broadly weaker crypto market driven mainly by a macro-led sell-off. The move reflects macro-driven risk aversion, as Bitcoin sold off alongside traditional markets ahead of key economic data.
Bitcoin’s drop closely mirrored declines in major equity indices and gold, with a 24-hour correlation of 0.94 to the S&P 500. This suggests broader market sentiment drove the move, likely as traders repositioned ahead of the Federal Reserve’s upcoming policy decision on October 28.
Bitcoin is currently trading as a macro-sensitive asset, with its price swayed by traditional market flows rather than crypto-specific news. Traders said the Fed’s statement on October 28, which could dictate near-term direction for risk assets.
The sell-off triggered significant liquidations, wiping out $106.16 million in Bitcoin long positions over 24 hours—a 23.54% increase from the prior day. Total crypto derivatives open interest fell 13.62%, indicating a broad unwind of leveraged bets.
Forced selling from over-leveraged positions exacerbated the drop, creating a feedback loop that pushed prices lower.
Crypto analysts say the immediate technical structure hinges on the $81,500 level. A convincing daily close below this support could push the market toward the next major support at $77,600.
The market is testing a crucial level that previously acted as both resistance and support; holding it is key for bullish sentiment. Bitcoin’s daily close is near $81,500, and spot ETF inflows need to resume to provide sustained buying pressure.
Bitcoin’s decline came from macro headwinds and a leveraged washout. While ETF inflows were positive earlier in the week, they couldn’t offset broader risk-off sentiment. XRP Rises on BlackRock’s iShares Bitcoin Trust Inflow Optimism
