Bitcoin drops over 6% in 24 hours, price falls below $71,000: In-depth analysis of the reasons for the correction and future market outlook

As external macroeconomic fluctuations intensify, the cryptocurrency market is experiencing a significant correction. Bitcoin prices have been under continuous pressure recently, successfully breaking below $74,000 and further weakening, currently trading below the key psychological level of $71,000. This article combines Gate market data with multi-dimensional market information to deeply analyze the underlying causes of this Bitcoin price correction, key technical levels, and market bullish-bearish divergences.

Market Snapshot: Bitcoin Leads Decline, Crypto Market Overall Adjusts

According to the latest data from Gate’s trading page as of February 5, 2026, Bitcoin (BTC) is quoted at $70,968.6, down 6.46% in the past 24 hours. Its 24-hour trading volume reached $1.61 billion, with a market capitalization maintained at $1.56 trillion, accounting for approximately 56.80% of the market share. During the session, Bitcoin’s price briefly dipped to a low of $70,122, clearly breaking the important round number of $71,000.

This correction is not an isolated event. Ethereum (ETH) also declined, breaking below $2,100. Market risk appetite has significantly cooled, with most mainstream altcoins experiencing more pronounced declines, indicating that funds are withdrawing from high-risk assets, and a broad crypto market pressure has already formed.

Analysis of the Downward Drivers: Macro Shocks and Internal Structural Adjustments

The current Bitcoin dip below $71,000 results from the combined effects of external macro shocks and internal structural adjustments within the crypto market.

Macro Storm: The Spillover Effect of US Stock Sell-Offs

1. Recently, concerns over valuation bubbles in AI and other sectors have intensified, triggering significant sell-offs in US tech stocks. As a global risk asset indicator, the decline in US stocks quickly affected the crypto market, which has a short-term correlation with them. Funds, seeking risk avoidance, are flowing out of both equities and cryptocurrencies simultaneously, amplifying Bitcoin’s selling pressure.

Internal Turnover: Release of Trapped Positions and Institutional Unrealized Losses

1. On-chain analysis shows that the current selling pressure mainly stems from trapped positions accumulated at higher levels earlier. As prices fall into their cost basis zones, some investors are choosing to cut losses and exit. A notable signal is that the Bitcoin holdings of well-known publicly listed company Strategy have experienced significant unrealized losses, reflecting that some institutional investors are also under pressure from the price correction. The market is entering a phase of high turnover and intense competition, rather than panic-driven one-sided selling.

Technical and On-Chain Analysis: Where Are the Key Support Levels?

After Bitcoin’s price decline, market focus quickly shifted to critical support zones.

• Bitcoin (BTC) Key Support: Most technical analysts are now eyeing around $68,000. This level is not only an important previous consolidation platform but also seen as the “lifeline” of the current upward trend. If it can be effectively supported and a bottom structure is built here, market sentiment may gradually stabilize. Conversely, if the $68,000 support is broken, further downside potential opens up.
• Ethereum (ETH) Next Target: After breaking below $2,100, ETH’s technical pattern points to the $1,665 - $1,725 range, which could be its next strong support zone to test.

Meanwhile, on-chain data shows that some long-term investors and new capital are engaging in “pyramid-style buying” during the decline, meaning that as prices fall, buying intensity and interest actually increase. This fierce battle between bulls and bears suggests that a market bottom may be forming nearby.

Market Divergence: Warnings and Opportunities Coexist

In the face of Bitcoin falling below $71,000, market opinions are sharply divided.

Bears and Risk Warnings:

Pessimistic voices are resurfacing. Notable investor Michael Burry recently issued warnings, stating that Bitcoin has fallen about 40% from its high, and if the decline continues, it could impact listed companies and related assets heavily holding Bitcoin. There are even discussions about a “$50,000 alert,” suggesting that if macro conditions worsen further, Bitcoin could face deeper corrections.

Bulls and Long-Term Convictions:

On the other hand, steadfast bulls believe this correction is healthy and necessary. Bitwise’s Chief Investment Officer publicly stated, “The crypto winter has already begun, and spring is just around the corner,” implying that the current market is closer to the start of a new cycle rather than its end. This view holds that market-wide turnover and cleansing will lay a more solid foundation for the next rally.

BTC Price Outlook Based on Gate Data

According to the integrated forecast model on Gate’s trading page, the long-term outlook for Bitcoin remains relatively optimistic. The model predicts that the average price of Bitcoin in 2026 could reach $78,559.7, with an annual fluctuation range estimated between $58,134.17 and $85,630.07.

Looking further ahead, forecasts suggest that by 2031, Bitcoin’s average price could hit $163,467.6, with a potential maximum reaching $210,873.2. This indicates that, based on the current price of approximately $70,968.6, the long-term potential return remains attractive according to some analysis models. Of course, this depends on enduring numerous market fluctuations and tests, including the current correction.

Summary: Finding Resolve Amid Volatility

The recent drop of Bitcoin below $71,000 is driven by macro headwinds, internal structural adjustments, and technical corrections. In the short term, the $68,000 level will be a critical bull-bear dividing line, warranting close attention from investors.

For market participants, in this complex environment where extreme risk warnings coexist with long-term bullish beliefs, maintaining rationality is crucial. The history of crypto markets always cycles through “fear and greed.” Every deep correction not only cleanses short-term speculators but may also present opportunities for prepared long-term investors.

You can access the latest real-time prices, depth charts, and rich on-chain data for over 1,700 cryptocurrencies, including Bitcoin and Ethereum, on Gate’s trading page to help you make more informed decisions in a volatile market.