Bitcoin's $108,000 Breakdown: Bearish Momentum and Contrarian Opportunities in a Shifting Cycle

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Bitcoin's recent breakdown below $108,000 has intensified bearish momentum, with technical indicators and on-chain data painting a picture of short-term weakness. As of October 15, 2025, Bitcoin trades at $107,483, having failed to reclaim the critical $110,500 resistance level, according to FXLeaders. The 20-day moving average (flat near $111,000) and the ascending 50-day MA (approaching $107,500) now form a bearish convergence, suggesting further downward pressure if the price falls below the latter, per Coinpedia. Meanwhile, the MACD histogram has turned negative, and the RSI remains in oversold territory, signaling potential exhaustion in the short-term rally, the FXLeaders piece notes.

Short-Term Bearish Momentum: A Confluence of Factors

The breakdown below $108,000 has triggered a cascade of selling pressure from large holders. On-chain data reveals that whales and sharks sold 17,554 BTC ($1.9 billion) between October 12–14, exacerbating the downward spiral, FXLeaders reported. This mass offloading aligns with historical patterns where institutional profit-taking precedes sharp corrections. The immediate focus is on the $105,500 support level, which, if breached, could extend the decline to $103,200 or even $100,000, Coinpedia warns.

The Crypto Fear and Greed Index, currently at a yearly low of 24, underscores extreme capitulation, as noted by FXLeaders. While this level historically signals short-term buying opportunities, Bitcoin must first stabilize above $108,000 to avoid a deeper correction. Bitwise analysts note that such fear-driven capitulation has historically preceded Q4 strength, but this requires a rebound above the 100-hour SMA, per the FXLeaders coverage.

Historical Volatility Cycles: A Shifting Paradigm

Bitcoin's traditional four-year price cycle, once a reliable framework, is showing signs of disintegration. The 2024 halving, for instance, defied historical norms by catalyzing a record high of $73,000 before the event, FXLeaders observes. This inversion is attributed to the influx of institutional capital via ETFs and macroeconomic tailwinds, which have reduced volatility and softened corrections.

The 2025 cycle has seen a 26% drawdown-a stark contrast to the 70–80% declines of 2017 and 2021, FXLeaders notes. This milder correction reflects stronger accumulation by long-term holders and steady ETF inflows, which act as a buffer against panic selling. However, the cycle's breakdown also means contrarian entry points are less predictable, requiring closer attention to liquidity zones and macroeconomic triggers.

Contrarian Entry Opportunities: Navigating the New Normal

For contrarian investors, the current environment offers a unique setup. Historical rebounds from breakdowns often occur when liquidity zones-such as the $110,000 level-act as strong floors. In March 2025, Bitcoin rallied off a similar liquidity zone after dipping to $112,380, with institutional bid stacking absorbing panic selling, according to AltcoinInvestor. A repeat scenario is plausible if the price stabilizes above $105,500.

Technical indicators also suggest a potential rebound. A daily close above $112,500 would invalidate the bearish setup and target $116,000–$120,000, Coinpedia's analysis indicates. Moreover, the TARCH (1,2,0) volatility model highlights asymmetric responses to negative returns, implying that a sharp rebound could follow the current oversold conditions, according to a ScienceDirect paper.

Strategic Considerations for Investors

1. Liquidity Zones: Focus on the $108,000–$110,000 range as a critical battleground. A sustained close above $108,000 would signal a shift in momentum.
2. ETF Flows: Monitor ETF inflows, which have historically removed circulating supply without aggressive buying. A surge in inflows could catalyze a rebound.
3. Macro Correlation: Bitcoin's growing sensitivity to interest rates and regulatory news means investors must factor in Fed policy and ETF approvals.

While the short-term outlook remains bearish, the broader trend above $95,000 remains intact, as Coinpedia's coverage suggests. For patient investors, the current volatility presents a chance to accumulate at discounted levels, provided risk management strategies-such as dollar-cost averaging and stop-loss orders-are in place.

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