Bitcoin price falls below $90,000, hitting a recent low in RMB terms. When will market selling pressure ease?

Thursday in the Asian market session, Bitcoin fell into a sustained correction trend. According to the latest market data, BTC is currently trading around $87,420, approximately 630,000 RMB, down more than 7% from the recent high of $94,500. Ethereum also declined to the $2,940 range, with a relatively mild drop, but mainstream coins such as Ripple and Solana all experienced corrections, with declines ranging from 1% to 1.5%.

Federal Reserve’s Expected Action but Market Response Remains Tepid

The U.S. Federal Reserve announced on Wednesday a 25 basis point cut to the benchmark interest rate and launched a short-term Treasury purchase program. However, this decision was not unanimously supported by the FOMC—two members advocated for holding rates steady, while another leaned toward a more aggressive rate cut. This growing internal disagreement reflects policymakers’ genuine concerns about the economic outlook.

The Fed’s post-meeting statement used cautious language, avoiding any commitment to further rate cuts next year, instead stating it will “closely monitor the latest economic data and risk dynamics.” Forecasts suggest two rate cuts in 2025, but some officials even anticipate up to six cuts throughout the year, indicating policy uncertainty.

More notably, the U.S. November CPI report was delayed to December 18 due to a government shutdown, and the rate decision was made in the absence of key economic data. ADP employment data showed that last month, companies cut 32,000 jobs, with manufacturing particularly weak. The Fed is effectively caught in a dilemma: too rapid rate cuts could exacerbate inflationary pressures caused by tariffs, while too slow cuts might worsen the labor market.

Market Decoupling and Structural Selling Pressure Suppress Rebound

Although Wall Street rose following the Fed’s policy easing on Thursday, the crypto market was sluggish. “This is a clear market disconnect,” said a derivatives trading head, noting that crypto traders are far less enthusiastic about rate cuts than traditional financial markets.

Worse still, Bitcoin’s price failed to hold above $94,000. Strategy Inc. bought a large amount of 10,624 BTC between December 1 and 7, investing about $962.7 million, marking the company’s largest purchase since July. Nonetheless, this did not prevent Bitcoin from continuing to decline, indicating that structural selling pressure in the market is swallowing demand-side buying.

According to traders, the next support level for Bitcoin is at $88,500, with $85,000 as a “critical bottom.” If this level is broken, the risk of accelerated downside in the short term will significantly increase.

On-Chain Data Shows Positive Signals, Selling Pressure Near Exhaustion

On-chain activity shows that Bitcoin inflows to exchanges have sharply decreased from November’s peak, and the amount of whale addresses depositing to exchanges is also declining. This phenomenon typically signals weakening market sell pressure.

Data indicates that when Bitcoin first fell below $100,000, large holders experienced unrealized losses exceeding $600 million, with total estimated losses reaching $3.2 billion. Since mid-November, short-term traders have been continuously selling at a loss. This widespread capitulation often signals that selling pressure is nearing exhaustion.

Despite multiple macro headwinds, Bitcoin remains stable around $92,000. However, this stability is not driven by strong market confidence. ETF inflows have only modestly improved, derivatives positions remain cautious, and the overall market is in a wait-and-see phase.

Next Fed Chair Could Rewrite Policy Direction

The selection of the next Fed chair is becoming a new variable. The Trump administration is vetting candidates, with Haskett, director of the National Economic Council, widely favored. Trump has explicitly stated that “whether to cut rates immediately” will be a key criterion, and current Chair Powell’s term ends in May next year.

Notably, Haskett previously led a 168-page report on digital asset regulation, and the market views him as a crypto-friendly policymaker. Forecast platforms show a 73% probability that Haskett will be nominated to succeed Powell before March 2025. If this change occurs, the crypto policy ecosystem could undergo significant adjustments.

Trump, in a Pennsylvania economic speech, again criticized Powell as a “bad Federal Reserve Chair” and hinted at possible adjustments to other Fed officials. Under this political pressure, the flexibility of future Fed policies may increase.

Technical Outlook: Key Support and Resistance Levels

From a technical perspective, Bitcoin failed to break through the resistance zone of $94,000 to $94,500, instead initiating a downward correction. The price broke below the 50% Fibonacci retracement of the $87,777 to $94,583 rebound zone and also breached the hourly uptrend line at $91,600.

Currently trading below $87,400 and under the 100-hour simple moving average, Bitcoin is approaching the support at $89,500 and the 76.4% Fibonacci retracement level.

Upside: If buying interest resumes, initial resistance levels are at $91,200, $91,500, and $92,000. A successful break above $92,000 could lead to testing $92,850 and then $93,500. Major resistance remains in the $94,000 to $94,500 range.

Downside: If the $92,000 resistance cannot be overcome, a new downward wave may begin. Key supports are at $89,500, $88,800, and $87,750. Breaking these could lead to a short-term dip toward $86,500. The final line of defense is at $85,000; a break below this would significantly accelerate the downside risk.

Technical Indicators: The hourly MACD is accelerating into a bearish zone, and RSI has fallen below the 50 midpoint, signaling ongoing short-term downward pressure.

Bank of Japan Becomes the Next Market Focus

The current key variable shifts to Tokyo. The market widely expects the Bank of Japan to raise interest rates by 25 basis points at its December 19 meeting. Japanese long-term government bond yields are approaching multi-decade highs, and policymakers are concerned about the rapid rise in yields.

BOJ’s decision could reshape global risk appetite and influence the future trajectory of crypto assets. Although the market remains generally stable for now, the future landscape depends on this critical event.

Overall View: While Bitcoin’s new lows in RMB valuation are concerning, on-chain data indicating waning sell pressure, combined with the Fed’s policy shift and personnel change expectations, leave room for a rebound. Whether it can hold the $85,000 support is not only a technical issue but also a psychological watershed for the market.