Bitcoin experienced a significant plunge this morning (10), with other altcoins fluctuating even more violently, resulting in over 560,000 people liquidating $1.7 billion in the past 24 hours, marking the second-worst in history! At the time of writing, the price has rebounded to $96,268, with a near 24-hour decline of 3.35%.

10x Research: Bitcoin may enter the death zone

Just recently, 10x Research released an analysis report on the 8th, pointing out that after experiencing a month-long celebration following Trump's victory, Bitcoin may currently be on the edge of entering the death zone, where BTC's upward momentum is weakening and the risk of a pullback is gradually increasing.

Firstly, 10x Research pointed out that the current trading volume of cryptocurrencies in the market has significantly declined. For example, in South Korea, where speculation is popular, trading volume has dropped from a peak of $25 billion to the current $6.7 billion (possibly affected by martial law); on Binance, the world's largest cryptocurrency exchange, spot cryptocurrency trading volume has also decreased from $60 billion to $24 billion.

This indicates a loss of overall upward momentum. Given this trend, it may now be a wise time to reduce leverage, adjust positions, and focus on core assets.

Additionally, 10x Research pointed out that when the Bitcoin MVRV indicator reaches 4, the market typically exhibits large-scale profit-taking, suggesting that the bull market has reached its peak. Currently, the MVRV indicator is at 2.7, also known as the mid-cycle peak of the bull market, during which a large number of investors may also take profits.

Finally, 10x Research noted that Bitcoin's current key support level is at $95,000. If it can break through $100,000 again, it may further push upwards. However, if it falls below the $95,000 level, investors may need to be cautious of further downside risks for Bitcoin.

Bitcoin's rise needs further catalysts

With Bitcoin recently experiencing a pullback, FalconX research director David Lawant stated that for Bitcoin to break through $100,000 again and remain stable above that level, further catalysts are needed.

As for the catalysts that could drive Bitcoin further up, I have compiled current market news and opinions, which may include:

  • On December 10, Microsoft will review a proposal for investing in Bitcoin;

  • Starting December 15, the Financial Accounting Standards Board (FASB) will introduce new regulations allowing crypto assets to be listed at fair market value in company financial statements, encouraging financial departments to include Bitcoin on balance sheets;

  • The US Federal Reserve will hold an FOMC interest rate meeting on December 18 to decide whether to continue cutting rates. Currently, there is a high probability of a 25 basis point cut, which means market liquidity may still be relatively abundant in the future;

  • The Bank of Japan will announce the benchmark interest rate on December 19. If it chooses not to raise rates, it may reduce market concerns about the risk of unwinding yen arbitrage positions;

  • Continuous net inflow of funds into Bitcoin spot ETFs