Wintermute: If Bitcoin falls below $75,000, it may quickly drop to the $70,000 range

By: rootdata|2026/05/19 20:45:01

Wintermute released a market outlook indicating that the cryptocurrency market has come under significant pressure this week due to the resurgence of inflation in the U.S. and a reversal in interest rate expectations. Bitcoin failed to break through the 200-day moving average when it first encountered a major macro shock, showing that the previous rally was driven more by short covering rather than sustained inflows of new capital.

The market environment has clearly changed, with U.S. CPI growth accelerating, core inflation exceeding expectations, and real wages turning negative. The yield on the U.S. 10-year Treasury bond has risen to 4.58%, while a new Fed chair with a more hawkish stance will take office in three weeks. The market's pricing of the Fed's policy path has also changed rapidly, shifting from betting on rate cuts to concerns about further rate hikes within just five trading days.

Cross-asset performance also reflects this change: Brent crude oil rose 8.6% this week, while Bitcoin and Ethereum fell 5.7% and 10.2%, respectively. Capital is flowing into assets that drive inflation, while cryptocurrencies have performed even weaker than the stock market during the downturn, a relative weakness that is considered a cause for concern.

Despite the long-term structural positives still in place, including Bitcoin reserves on exchanges remaining at multi-year lows, long-term holders continuing to accumulate, and the advancement of the U.S. crypto regulatory bill "CLARITY," institutional capital is more inclined to take profits on rebounds in the short term rather than continue to increase positions. The market is currently focused on the $76,000 to $78,000 range for Bitcoin; if it can hold this position after Nvidia's earnings report on Wednesday, market confidence may recover. However, if it falls below $75,000, along with a decline in funding rates and continued outflows from ETFs, it could quickly drop to the $70,000 range.

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