Is Bitcoin’s slide about to break below $80,000 and trigger a wider market rout?

Bitcoin plunged below $81,000 on Friday, its lowest since April, as liquidations and institutional outflows threatened to break a key technical level, risking widespread forced selling in crypto. The world’s largest cryptocurrency dipped as low as $80,548 before stabilizing near $85,702, erasing what little remained of its year-to-date gains and signaling fragile support in a market where leverage and algorithmic trading have amplified every downward tick.​ A decisive break below $80,000 would erase months of support , likely triggering billions in liquidations, amplified by leverage and threatening spillover into equities. Bitcoin technical support at $80,000 is under siege Bitcoin’s $80,000 level represents far more than a psychological barrier; it’s a structural floor that has held after multiple tests this month. A breakdown invalidates months of technical accumulation and signals a potential bearish reversal that could cascade toward $70,000–$75,000 support zones established during late 2024. The Bitcoin Volatility Index has surged to 50.32, reflecting market uncertainty at dangerous levels where even minor catalysts trigger violent swings.​ Technical analysis confirms the fragility. Bitcoin fell below the critical $92,500 resistance level earlier this week, which has now flipped to resistance rather than support. Once that level breaks decisively, analysts warn the next downside target becomes $84,000, a level already tested intraday. Below that lies the red zone: $80,000, and if that fails, rapid capitulation toward $70,000 becomes probable. Open interest in Bitcoin futures has already plummeted 35% from October’s $94 billion peak, signaling capitulation among leveraged players before the big money has even started unwinding.​ Leverage, ETF flows, and Fed signals will decide if contagion spreads The real danger isn’t Bitcoin’s isolated decline; it’s the structural triggers that could amplify into equities. Bitcoin ETF outflows accelerated sharply: US-listed spot Bitcoin products lost $2.9 billion in November , with BlackRock’s IBIT accounting for $2.1 billion of redemptions. On a single day last week, IBIT shed $523 million, a record outflow that reflects institutional capitulation amid uncertain Federal Reserve policy.​ More troubling: Bitcoin’s correlation with the Nasdaq has hit a 0.8 level, dangerously high and asymmetric. Bitcoin falls harder than the Nasdaq on down days but lags during rallies, acting as a “high-beta tail” of risk sentiment rather than a standalone asset class. This means if equities roll over sharply, Bitcoin will amplify the carnage.​ The Fed’s ambiguous December rate cut messaging has evaporated the risk-on tailwind that supported crypto valuations. Mixed September jobs data (119,000 payrolls added, 4.4% unemployment) left policymakers without clear guidance, prompting traders to dial back December rate-cut odds to 46%. Without Fed support and facing redemptions from institutional players, Bitcoin has nowhere to hide.​ If $80,000 fails, expect cascading liquidations to drag altcoins and crypto-linked equities lower, and potentially test whether equities decouple or join the retreat. The post Is Bitcoin’s slide about to break below $80,000 and trigger a wider market rout? appeared first on Invezz