Bitcoin Drops 10% to $105,100 Amid Macro Concerns and Whale Sell-Offs

Bitcoin's price experienced a notable decline, reaching an intraday low of $105,100. This drop was driven by multiple factors, including macroeconomic headwinds, technical indicators, and significant sell-offs by long-term holders, including large investors known as whales. The sell-off occurred despite Bitcoin achieving its highest monthly close ever, highlighting the complex dynamics at play in the crypto market.

Macroeconomic factors played a significant role in hindering Bitcoin's upward momentum. Recent data on job openings and the ISM Manufacturing PMI indicated a strong labor market and inflationary pressures. Job openings climbed to their highest level since November 2024, while the ISM Manufacturing PMI exceeded expectations, suggesting a robust economy. These factors could influence the Federal Reserve to delay rate cuts amid inflationary concerns. According to the CME FedWatch tool, over 75% of the market expects the Fed to hold rates steady in July, although a slight majority anticipates more than two cuts this year.

The feud between billionaire Elon Musk and President Donald Trump also contributed to Bitcoin's price volatility. The escalating conflict provided traders with a reason to support a drop in Bitcoin's price after it had been range-bound for several days. Musk's challenge to Trump's "Big Beautiful Bill" and Trump's threats to cut government subsidies for Musk and potentially deport him to South Africa added to the market's uncertainty. The Senate's narrow approval of the bill, which would add $3.3 trillion to the US debt, further exacerbated the situation.

Investors and traders remained bullish in the long term, adjusting their positions based on Bitcoin's chart patterns. The recent pullback occurred after the price dropped below the $106K support level and fell below the 50-SMA in the daily chart. However, the price movement aligned with the consolidation phase of a bullish cup-and-handle pattern, suggesting potential for a future breakout to $168,000.

Spot Bitcoin ETFs saw significant outflows, with a total of $342.2 million in net outflows on Monday, ending a 15-day inflow streak. Fidelity’s FBTC recorded $172.7 million in outflow, while Grayscale’s GBTC saw $119.5 million in outflows. BlackRock’s IBIT had zero outflows, and outflows from Bitwise and Ark 21Shares spot Bitcoin ETF were $23 million and $27 million, respectively. These outflows indicate a shift in investor sentiment towards Bitcoin ETFs.

On-chain data platforms noted multiple transactions moving Bitcoin to crypto exchanges in the last 24 hours. The largest transaction involved a whale moving 1,595 BTC worth $168.55 million into Binance. According to Coinglass data, Bitcoin recorded more than $85 million in liquidations in the last 24 hours, with more than $75 million in longs liquidated. The crypto market saw 101,911 traders get liquidated, with the largest single liquidation of BTCUSD valued at $2.62 million on crypto exchange Bybit. This liquidation activity highlights the significant impact of large investors on the market.

In summary, the decline in Bitcoin's price can be attributed to a combination of macroeconomic factors, technical indicators, and significant sell-offs by long-term holders. The waning interest from retail investors, the influence of large investors, and the regulatory environment are all contributing to the current market conditions. As the market continues to evolve, it will be crucial for investors to stay informed about these factors and their potential impact on Bitcoin's price.