Bitcoin rapidly drops below $86,000, with 220,000 traders liquidated, losing $814 million—Fei Cheng's financial crisis warning rings again

Tech Stocks’ Earnings Fail to Turn the Tide, Employment Data Turns from Positive to Worrying

Despite NVIDIA reporting a stunning third-quarter revenue exceeding $57 billion, CEO Jensen Huang personally refuted the “AI bubble theory,” which temporarily halted the decline in U.S. stocks. However, this wave of optimism has not spread to the cryptocurrency market. On the contrary, Bitcoin has continued to slide in recent months, breaking below the daily upward trend line, with technical indicators showing an accelerating downward pattern.

In September, the U.S. non-farm payroll added 119,000 jobs, surpassing market expectations of 50,000. On the surface, this appears to be a positive signal. However, the unemployment rate rose to 4.44%, increasing month over month, indicating potential underlying concerns in the labor market. Analysts point out that this data will be an important reference for the Federal Reserve’s rate decision next month, with market focus shifting to the expectation of “whether the Federal Reserve will initiate a preemptive rate cut in December.”

Institutional Withdrawals, Whale Sell-offs, Retail Hesitation—Cryptocurrency Market Falls into a “Dilemma”

According to 10X Research analysis, the cryptocurrency market has entered a bear phase, with three major negative signals emerging simultaneously:

Deteriorating Liquidity: Large ETFs and institutional funds that once supported the market continue to withdraw, causing the market to lose key buying support.

Whale Selling Pressure: Since September, large-scale investors have sold over $20 billion worth of assets, creating heavy selling pressure. This also reflects long-term holders’ concerns about market prospects.

Retail Investors’ Lack of Interest: Market sentiment continues to worsen, retail investors are reluctant to buy the dip, liquidity is rapidly shrinking, and this has triggered a chain reaction akin to a financial crisis.

James Butterfill, Head of Research at CoinShares, further pointed out, “The ‘four-year cycle’ theory, although not necessarily supported by fundamentals, has evolved into a self-fulfilling prophecy, continuously driving large holders to reduce their positions.”

Technical Oversold Conditions Yet No Sign of Bottoming, $85,000 Becomes a Critical Line

From a technical analysis perspective, Bitcoin’s daily RSI indicator has entered the oversold zone, theoretically close to a rebound. However, since the market is still in an accelerating decline phase, the short-term trend remains bearish. Options market data shows traders are actively positioning for downside protection, with $85,000 becoming the most critical support level, followed by $82,000.

Industry experts believe that if Bitcoin can hold above $85,000, a phased rebound may occur before the end of November; conversely, if this level is broken, it could further decline toward the $80,000 mark, releasing more pessimistic market signals.

Rate Cut Expectations and Long-term AI Momentum—Are Turning Points Emerging?

Although short-term sentiment remains bearish, Federal Reserve policies and AI trends are still key variables. NVIDIA’s earnings demonstrate that demand for AI remains strong, and long-term growth momentum persists. On the other hand, if unemployment continues to rise, the likelihood of the Fed initiating a preemptive rate cut in December increases, which could inject liquidity and help stabilize and recover crypto assets.

Waiting for Opportunities Amid Panic

Currently, the cryptocurrency market is experiencing a double blow of leverage liquidation and institutional withdrawals. Investors should closely monitor the $85,000 support level and pay attention to market signals after the end of November. Historical experience shows that extreme oversold conditions often present long-term investment opportunities. Only by remaining calm amid panic can investors seize the window for the next rebound.