Bitcoin Dips Below $90K as Leverage Unwinds—Dip Buyers Eye Key Support Levels for Entry

Bitcoin just sliced through the $90,000 mark—a move fueled by a cascade of liquidations as over-leveraged positions get washed out. But beneath the red candles, a familiar pattern emerges: strategic capital waits in the wings.

Where the floor might form

Traders aren't just watching the price; they're tracking the liquidation heatmaps and exchange flows. The unwind isn't a crisis—it's a necessary reset. Key support zones, previously established as accumulation areas, are now flashing on every major dashboard. The question isn't if buyers will step in, but at what precise level.

The mechanics of a healthy pullback

This isn't a breakdown; it's a breather. High leverage had inflated the recent rally, creating a wobblier structure. Flushing that out strengthens the foundation for the next leg up. On-chain data shows coins moving from weak hands to strong ones—a classic bullish transfer, even if the spot price temporarily dips.

Timing the tide

The smart money views this as a discount, not a disaster. They’re monitoring order book depth and derivatives funding rates, waiting for the panic to fully subside before deploying dry powder. It’s a game of patience and precision—buying when others are forced to sell, a timeless tactic in volatile markets. After all, what's a 10% correction in crypto other than a Tuesday? Sometimes the market needs to remind everyone that leverage works both ways—a lesson delivered with the subtlety of a sledgehammer.

Leverage Unwinds Trigger Sharp Sell-Off

Data from CoinGlass showed that roughly $1.08 billion in crypto positions were liquidated over 24 hours, affecting more than 183,000 traders. Long positions made up about 92% of those liquidations, indicating that many traders had been positioned for further upside.

The largest single forced closure was a $13.52 million BTCUSDT position on Bitget, underscoring how crowded bullish bets had become. As prices slipped, automated liquidations accelerated the decline, pushing Bitcoin through key psychological levels.

This unwinding followed weeks of relative calm in crypto markets, during which the Bitcoin price had consolidated near its highs. Once selling pressure began, it quickly exposed how dependent recent price stability had been on Leveraged positioning rather than fresh spot demand.

Macro Risks Weigh on Risk Assets

The crypto sell-off unfolded alongside broader market stress. U.S. President Donald Trump’s renewed tariff threats against European nations, tied to disputes over Greenland, revived fears of a trade war. Similarly, a sell-off in Japanese government bonds pushed global yields higher, tightening financial conditions.

U.S. equities also suffered their worst session since October, with major indices dropping more than 2%. Crypto-related stocks such as Coinbase, Strategy, and Circle posted steep losses, reflecting a wider shift away from risk-sensitive assets.

While the Bitcoin price and altcoins fell, gold and silver moved in the opposite direction. Gold traded NEAR record highs above $4,800 per ounce, and silver also reached new peaks. The contrast suggested that investors were rotating into traditional safe havens as uncertainty grew.

Despite the volatility, Bitcoin has shown early signs of stabilization. Prices rebounded toward the $89,000–$90,000 area as pressure in bond markets eased and U.S. equity futures ticked higher. Still, analysts caution that the MOVE looks more like a pause after forced selling than a clear return of risk appetite.

Technical indicators highlight the $87,000–$88,000 range as a critical support zone. A break below this level could open the door to further declines toward $85,000 or lower. On the upside, Bitcoin price faces resistance near $92,000 and $95,000.

Related Reading: XRP Holders Quietly Build Positions In A Pattern That Echoes Earlier Cycles

For now, traders are closely watching macro developments, including Trump’s speech at the World Economic Forum in Davos and ongoing signals from global bond markets. Whether dip buyers step in with conviction may determine if Bitcoin can reclaim lost ground, or if the recent slide has further to run.

Cover image from ChatGPT, BTCUSD chart on Tradingview