Bitcoin finds support at $100,300, eyes the $106k mark: check forecast
The cryptocurrency market showed signs of stabilisation on Wednesday after a market-wide correction. Bitcoin's price, which briefly dropped below $100k for the first time since May, rebounded to above $101k, finding temporary support at $100,353. The drop was driven by declining institutional demand, with $1.9 billion in outflows from Bitcoin ETFs over five days, including significant losses from Fidelity, Ark & 21Shares, and Grayscale. Analysts predict Bitcoin could fall to $72k if it fails to hold the ~$100k support level. Technical indicators remain bearish, showing a lower RSI and negative MACD, but if support at $100,353 holds, Bitcoin might rally towards $106k. Overall, the market remains in bearish conditions due to continued institutional selloff and reduced demand.
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Stabilisation in the Cryptocurrency Market
The cryptocurrency market is showing signs of stabilisation on Wednesday following the market-wide correction earlier in the week. Bitcoin temporarily dropped below $100k on Tuesday but is now trading above $101k. The leading cryptocurrency is now consolidating around its key support level, suggesting that traders could enter the market amid easing volatility.
Institutional Demand and Bitcoin’s Decline
BTC fell below the $100k mark for the first time since May, primarily due to a decline in institutional demand. According to SoSoValue, spot bitcoin ETFs saw $577.74 million in outflows on Tuesday. Major contributors to this outflow included:
- Fidelity’s FBTC: $356.6 million
- Ark & 21Shares’ ARKB: $128 million
- Grayscale’s GBTC: $48.9 million
The massive outflow marks the fifth consecutive day of ETF outflows, totaling $1.9 billion during this period. Rachael Lucas, a crypto analyst at BTC Markets, highlighted this as a decisive shift in institutional positioning, noting that this is not just a pause but a recalibration of market sentiment.
Bearish Predictions for Bitcoin
Analysts at the on-chain analytics firm CryptoQuant predict that Bitcoin could drop to the $72k level if bulls fail to sustain the price above $100k. According to Julio Moreno, CryptoQuant’s head of research, if Bitcoin drops below the critical $100,000 area, the risks of it targeting $72,000 within one to two months increase significantly.
Moreno attributed the decline in institutional interest to the ongoing contraction in spot demand, especially following the October 10 liquidation event. In the US, indicators such as negative ETF flows and a declining Coinbase price premium further confirm the weakening demand. CryptoQuant's Bull Score Index, which currently stands at 20, reinforces the overall bearish market condition since early October.
Temporary Support Above $100k
The BTC/USD daily chart remains bearish after Bitcoin lost 10% of its value over the last seven days. Earlier this week, Bitcoin faced rejection around the $106k mark, losing 8% of its value. It retested the 50% retracement level at $100,353 before bouncing back to trade above $101k.
The 50% retracement level at $100,353 now serves as a temporary support level, possibly enabling Bitcoin to rally higher shortly. Should this level hold, Bitcoin might approach the next major resistance at $106,435. However, a break below this support could signal further declines, with the next support level around $97k.
Technical Indicators Show a Bearish Trend
Technical indicators for Bitcoin remain bearish:
- The Relative Strength Index (RSI) is at 41, below the neutral 50, indicating sustained selling pressure.
- The Moving Average Convergence Divergence (MACD) lines are in negative territory, signaling a bearish bias.
If Bitcoin’s price closes below the $100,353 support level, the bearish trend may continue, leading to a potential decline towards $97k, a significant daily support level.