Due to the uncertainty surrounding the Federal Reserve's December decision, it may be wiser to act cautiously and manage positions rather than predict a short-term bottom.
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As Bitcoin and Ethereum prices weaken, the cryptocurrency market continues to decline. Analysts warn that liquidity remains tight, and market sentiment is trending towards weakness ahead of the December interest rate decision.
Three Key Points
• With increasing selling pressure and weakening buying momentum, Bitcoin and Ethereum have seen their declines widen, indicating a loss of market confidence and a deterioration in short-term market sentiment.
• Market leaders emphasize liquidity pressure, changes in interest rate expectations, and structural pressures rather than panic selling, suggesting that the cycle may still be in a mid-term phase.
• Due to the uncertainty surrounding the Federal Reserve's December decision, it may be wiser to act cautiously and manage positions rather than predict a short-term bottom.
The cryptocurrency market remained challenging yesterday, with market sentiment continuing to shift towards caution.
Both Bitcoin (BTC) and Ethereum (ETH) have seen their declines widen, reflecting buyers' hesitation and dominant selling pressure. Unlike previous crashes, this decline resembles a steady, controlled pullback. This indicates that leverage is quietly decreasing rather than being aggressively liquidated.
Recent price movements of Bitcoin highlight this pattern. Earlier this week, Bitcoin made several attempts to return to higher levels but failed, leading to further weakening momentum. As of the time of writing, Bitcoin is trading in the range of $89,500 to $89,600, down again from last week's levels. Ethereum's movements closely mirror Bitcoin's, failing to break free from Bitcoin's constraints and unable to find effective support.
The overall tone of the market has shifted: declines are no longer seen as buying opportunities but have triggered silence and caution—indicating weak market confidence.
Last 24 Hours: Data Confirms Market Weakness
In the past 24 hours, Bitcoin's price has continued to decline.
From the 4-hour chart, the structure shows persistent downward pressure accompanied by increasing selling volume. Several brief attempts at a rebound quickly faded, indicating a lack of confidence among buyers. Larger sell orders and rising trading volume suggest that this trend may not be driven solely by retail sentiment.
Since November 14, Bitcoin has exhibited a clear trend pattern: lower highs, weakening rebound strength, and gradually increasing supply. If this trend continues, traders may shift their focus to deeper structural support areas rather than expecting a quick price rebound.
The decline has not triggered panic but has indeed brought about weakness. This alone is enough to make investors who anticipated a stronger year-end rebound feel uneasy.
What Market Leaders Are Saying
Some notable figures have commented on the current market situation, providing context beyond the charts.
Tom Lee of Fundstrat attributes the current weakness to the lingering effects of the deleveraging event on October 10. He believes that market makers' balance sheets may still be impaired, leading to a temporary liquidity shortage similar to quantitative tightening in the cryptocurrency space. However, Lee maintains that the current cycle has not yet reached its final peak, noting that the true top may still be one to three years away.
Arthur Hayes takes a more cautious view. He points out that Bitcoin's decline while the stock market remains high may signal brewing credit pressure. His liquidity model shows a weakening dollar. If policymakers intervene before liquidity tightens further, Bitcoin's price could drop to above $80,000. However, Hayes believes that once liquidity recovers, Bitcoin is still poised for a strong long-term upward trend.
Cathie Wood remains optimistic about Bitcoin as an asset class. Although she acknowledges competition within the ecosystem—especially from stablecoins—she still views Bitcoin as a long-term macro asset rather than a speculative cyclical product.
These combined viewpoints suggest that the weakness may be structural rather than emotional—driven by liquidity mechanisms rather than a loss of confidence.
The Federal Reserve's December Decision Has a Significant Impact on Market Sentiment
The uncertainty surrounding the Federal Reserve's upcoming decision has become another pressure point.
The probability of no interest rate cut in December has risen significantly, becoming a common expectation in traditional markets and forecasting platforms. Despite recent political turmoil, traders seem more focused on data and central bank communications.
This shift is significant for asset classes closely tied to liquidity conditions. Prolonged high interest rates will suppress speculative appetite, reduce leverage, and accelerate risk-averse behavior—all of which are now evident in the digital asset market.
Is This the Market Bottom?
It seems premature to assert that the market has bottomed out. The current market environment lacks the typical characteristics of a cycle's end: forced liquidations, capitulation selling, extreme panic, or severe valuation dislocation. Instead, the market appears to be slowly declining, seeking stability amid ongoing liquidity contraction.
But this does not mean that long-term investment strategies have become ineffective. Rather, it means that timing is crucial—rushing in based on assumptions rather than signals increases risk.
Looking Ahead
For now, acting cautiously may be more appropriate than aggressively building positions. Gradually accumulating positions, maintaining flexibility, and avoiding leverage may be wiser in the coming weeks.
The next round of expansion will eventually arrive—but the market may need to undergo a winter cycle to regain momentum. Until then, patience is not a sign of weakness.
This is self-discipline.
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