Bitcoin recently slipped below $113,000, sparking questions about whether the bull market is losing momentum or if this is just a temporary pullback. While the decline reflects growing investor caution amid global economic uncertainty, experts suggest that the long-term bullish trend for BTC remains intact.
Market Sentiment and Options Fear
The cryptocurrency market is showing signs of heightened fear. Bitcoin’s options market delta skew, which measures the balance between put (sell) and call (buy) options, surged to 12%, its highest level in over four months. Typically, a neutral reading falls between -6% and +6%. Values above 10% indicate extreme fear, often signaling short-term pessimism but historically precede rebounds.
A similar spike occurred in April, when Bitcoin dropped significantly, followed by a notable recovery. Investors who navigated that period successfully witnessed gains of around 40% in the following month, suggesting that panic-driven market moves often overshoot fundamentals.
External Economic Pressures
Several global economic factors are influencing investor behavior:
US Trade Tariffs: The introduction of a 50% import duty on hundreds of aluminum- and steel-containing products, including car parts and specialty chemicals, has raised concerns over supply chain disruptions and higher consumer prices.
Stock Market Volatility: Recent research revealed that most companies failed to achieve rapid revenue growth from AI pilot programs, impacting investor sentiment.
Gold and Dollar Trends: Analysts have increased their gold price forecasts for the next few years, citing slower economic growth, potential central bank easing, and a weaker dollar. Rising gold demand signals caution toward riskier assets like equities and cryptocurrencies.
Regulatory Concerns and Corporate Setbacks
Bitcoin’s price also reacted to regulatory and corporate developments. Reports emerged of investigations into potential fraud and stock manipulation at companies involved in high-profile financial projects. Combined with disappointing AI adoption results in major companies, these factors added to risk aversion in crypto markets.
Long-Term Perspective
Despite short-term volatility, Bitcoin’s fundamentals remain strong. The market’s fear often exceeds rational expectations, creating opportunities for informed investors. Historical patterns suggest that dips driven by panic—rather than structural weakness—can precede significant recoveries.
While $112K may act as a near-term support level, it is not necessarily the “final bottom.” Bitcoin’s long-term bullish trend remains intact, and periods of turbulence may even be beneficial as investors reassess risk and seek potential opportunities in the crypto market.