Bitcoin is experiencing a decline, with its value hitting levels not observed since 11 November of the previous year. This downturn occurs as the US dollar strengthens against other currencies.

This downturn suggests that broader economic forces are influencing prices, with traders adjusting their positions in response to external pressures. A stronger US dollar often leads to downward movements in assets like Bitcoin, as it becomes more expensive for those using other currencies to invest. This pattern has played out before, and it is happening again now.

Market sentiment is also shifting. Investors who were optimistic just a month ago are reassessing their strategies, especially as global liquidity tightens. When borrowing costs rise and liquidity declines, riskier assets tend to see less demand. Bitcoin, which has long been viewed as both a hedge and a speculative instrument, is reacting much as it has in previous cycles.

Technical indicators now show momentum slowing. The latest charts suggest pressure building near key support levels, and if those do not hold, further declines could follow. At the same time, historical data reminds us that corrections of this scale are part of Bitcoin’s behaviour. Some see this as an opportunity, while others step to the sidelines and wait for a more favourable entry.

Macroeconomic conditions cannot be ignored. Inflation data, central bank policies, and employment statistics all play a role, directly or indirectly, in shaping expectations. Jerome, as head of the Federal Reserve, remains firm in his stance, and his recent remarks indicate that tightening policies will not change course too soon. That has consequences not only for traditional markets, but also for digital assets. In previous instances, similar tightening cycles led to reduced activity in speculative markets.

Meanwhile, institutional involvement shows contrasting signals. Some firms continue to accumulate, while others pause. This divide reflects differing views on what comes next. Long-term holders often take downturns in stride, while short-term participants may feel pressure to exit. These opposing forces create the kind of volatility that has defined Bitcoin for years.

As we look ahead, the coming weeks will likely be shaped by external economic factors as much as by technical trends. Responses from policymakers, adjustments in global liquidity, and shifts in sentiment will all influence what happens next. The question now is whether the current support levels will hold, or if further adjustments need to be made.