Bitcoin is showing signs of recovery after the deepest pullback of the current cycle. On Friday, the leading cryptocurrency dropped to $81,000, triggering large liquidations and a wave of sell-offs. Early this week, BTC rebounded to around $87,000. Analysts note that bearish sentiment still dominates the market, although many believe new Bitcoin highs may not be far off.
The biggest pullback of the cycle and mass liquidations
On November 21, the crypto market experienced one of its most significant events in recent months. The sharp decline in Bitcoin’s price triggered almost $2 billion in liquidations across the derivatives market. Traders faced a cascade of margin calls as BTC broke key support levels around $90,000 and continued to decline.
The correction also coincided with heavy pressure from institutional investors. United States spot Bitcoin exchange-traded funds recorded their fourth consecutive week of net outflows. Investors withdrew $1.22 billion for the week ending November 21, based on data from SoSoValue, bringing the four-week total to $4.34 billion.
One fund stood out in particular: BlackRock’s IBIT, which recorded more than $1 billion in outflows in a single week, marking the second-largest weekly outflow in the ETF’s history. Analysts note that institutions are not exiting the market entirely but rebalancing risk in response to heightened volatility.
Santiment reports a collapse in market sentiment
At the same time, retail sentiment has deteriorated sharply. Santiment data shows that the volume of bullish commentary across major social platforms, including X, Reddit, and Telegram, has declined to its lowest level since December 2023.
Retail traders are capitulating, discussions are turning increasingly bearish, and emotional reactions to every price drop reflect rising fear and tension across the market.
Analysts note that Bitcoin’s chart structure, marked by a sequence of lower highs and lower lows, is adding pressure. Losing the $90,000 level delivered a psychological setback and prompted many traders to close positions in large numbers.
BTC is recovering, but the momentum is extremely weak
The market, however, is showing signs of local stabilization. Bitcoin is trading near $85,000, and the broader crypto market is recovering gradually. Experts, however, view the current rebound as a post-flush bounce rather than the beginning of a sustained reversal.
“[BTC’s current price] reads like a post-flush bounce: liquidity pockets shallow, flow fragmented, and bids probing for stability all while long-horizon holders are accumulating,” said Vincent Liu, CIO at Kronos Research. “Expect consolidation with tight ranges around 85K to 90K, as liquidity is shallow and stops are being picked off.”
The Fear and Greed Index sits at 19, still in the extreme fear zone, which indicates that traders remain cautious and are monitoring liquidations and large order flows closely.
Warning signs remain
BTC Markets analyst Rachael Lucas says Bitcoin is attempting to hold above $86,000, which she considers constructive for the short term. However, she cautions:
“If Bitcoin fails to break above $88,000, the market would risk falling to the $80,000 level.”
Lucas notes that short-term traders are acting cautiously, while long-term holders continue to accumulate. Institutions, she adds, are not exiting the market. They are in a rotation phase rather than withdrawing capital.
Institutional investors remain optimistic
Despite market pressure, several major players remain confident in Bitcoin’s long-term potential.
BlackRock CEO Larry Fink recently said that the price of BTC “could potentially reach $700,000” in the current cycle if institutional demand continues to grow. His forecast reflects the increasing interest among large asset managers in digital assets and long-term accumulation strategies.
Against the backdrop of volatility and short-term risk, some analysts maintain that the current downturn and retail capitulation are part of a broader setup for the next growth cycle.
A number of experts believe that Bitcoin price could test new highs in early 2026, especially if institutional funds continue increasing their exposure to digital assets.
Market outlook
In the short term, the market remains fragile. Shallow liquidity, sharp swings, and a weak chart structure all point to the possibility of another move toward $80,000. The long-term picture, however, is different. Institutional interest remains strong, long-term holders continue to accumulate BTC, exchange-traded fund outflows resemble risk management rather than exit, and underlying demand remains intact.
The crypto market now stands between fear and future opportunity. The coming weeks may play a decisive role in forming the next trend, whether that leads to consolidation or the beginning of a gradual reversal upward.