Bitcoin is once again under pressure, dropping below $108,000 and leaving investors uneasy. The world’s largest cryptocurrency fell to $107,477 earlier this week, wiping out billions in value.
Many traders now describe the current phase as Bitcoin “flirting with danger,” as it tests critical support levels that could determine its short-term trend.
A major factor behind the decline is a wave of liquidations in the crypto futures market. Last week, over $19 billion worth of leveraged positions were wiped out from the market, forcing traders to sell assets in a domino effect. The sell-off has also affected other leading cryptocurrencies, including Ether, Solana, and XRP.
At the same time, global economic tensions are weighing on the market. The rising U.S.–China trade tensions, fears of higher interest rates, and warnings of a possible global correction have made investors more cautious.
“The escalation of U.S.-China trade rhetoric poses a substantial downside risk to risk assets, including Bitcoin,” Farzam Ehsani, Co-Founder and CEO of VALR told The CryptoTimes. “Historically, Q4 has been a favorable season for the crypto market, but this time around, the market is contending with a highly complex backdrop where geopolitical uncertainty and global trade dynamics could easily override seasonal tailwinds.”
As high-risk assets, cryptocurrencies like Bitcoin feel these shifts more acutely. The Crypto Fear & Greed Index has now reached a reading of 28, moving swiftly toward the “extreme fear” line.
For traders, $108,000 is the make-or-break level. If Bitcoin is above this support, the market may stabilize and inspire buyers. However, anything under $104,000 could result in massive selling. On the upside, a climb back above $112,000 could restore confidence and encourage fresh buying.
At the time of writing, Bitcoin was trading at $108,890 with a 24-hour trading volume of $86.39 billion and a market cap of $2.16 trillion.
Despite the fear, some long-term investors are viewing the dip as a possible buying opportunity. Bitcoin is still up over 180% year-to-year and its fundamentals, scarce supply, institutional buying, and international demand are still in place.
“While the Fed Chair’s remark suggests that the tightening cycle may be nearing its end, economic data dependency remains high,” Ehsani emphasized, adding, “A prolonged U.S government shutdown could delay critical inflation and employment data, complicating the Federal Reserve’s next monetary policy and rate decisions, which further adds uncertainty to the liquidity outlook.”
Meanwhile, Bitcoin’s next few days will be crucial. Whether this is a minor pullback or the start of a deeper correction depends on how investors react to macroeconomic pressures and market sentiment.