Bitcoin Faces Key Support Test as Standard Chartered Flags Volatility

Bitcoin’s recent price action has traders on edge as Standard Chartered’s Geoff Kendrick warns of a potential test of critical support levels between $69,000 and $76,500.

This zone, which aligns with BTC’s price movements following the U.S. election in November 2024, could determine the short-term trajectory of the asset.

BTC’s Downward Momentum

While much of the recent market discussion has revolved around Trump’s pro-crypto stance, Kendrick emphasizes that broader macroeconomic factors, including a sharp decline in Nasdaq futures, have played a far bigger role in Bitcoin’s downward momentum.

The sell-off coincides with growing risk aversion across both traditional and digital asset markets. Trump’s recent trade tariffs on Canada and Mexico, coupled with fresh concerns over the U.S. economy’s stability, have further fueled negative sentiment.

Since last week, Bitcoin has dropped over 10%, now hovering near $83,000, while Ethereum has plunged below $2,100, marking its lowest point since November 2023.

Strategy’s Bitcoin Holdings Under Pressure

As BTC approaches the $69,000-$76,500 support range, its correlation with publicly traded firms like Strategy (formerly MicroStrategy) is becoming a focal point for analysts.

Strategy’s average BTC purchase price sits around $65,000, making any further decline particularly significant for the company’s balance sheet. Standard Chartered’s report highlights that Strategy’s stock (MSTR) has already been hovering at levels that mirror its November 6, 2024, price action.

A continued drop in Bitcoin’s price could increase selling pressure on MSTR as investors reassess the company’s exposure to BTC.

Despite Trump’s bullish rhetoric  on crypto, the institutional response tells a different story. ETF flows suggest that large investors are reducing exposure rather than accumulating. Bitcoin ETFs have been experiencing steady outflows, with BlackRock’s IBIT and Fidelity’s FBTC leading the charge in redemptions. Last week alone, IBIT recorded over $1 billion in outflows, signalling that institutions remain cautious despite retail enthusiasm.

Ethereum has not been spared from the broader market downturn, with ETH ETFs recording their eighth consecutive day of outflows. On Monday alone, spot ETH ETFs saw $12.1 million exit, extending a pattern of institutional selling that has plagued the asset for weeks.