Published: 1 December 2025,03:20
Daily Market Analysis New
*Bitcoin drops over 3% and Ethereum slips below $3,000 as roughly $100B is wiped from total market cap, alongside $400M in long liquidations.
*A fresh joint statement from 13 Chinese government departments to crack down on crypto trading revives memories of the 2021 ban, triggering panic selling in Asian hours.
*Thin liquidity with unclear December Fed outlook keep risk appetite weak, with markets now hinging on this week’s ADP data as PCE figures arrive only after the Dec 10 FOMC meeting.
Digital asset markets opened the week under significant selling pressure during Asian trading hours, with Bitcoin declining over 3% and Ethereum breaching the critical $3,000 level to trade near $2,850. The sector saw approximately $100 billion erased from total market capitalization, accompanied by roughly $400 million in long position liquidations during the initial hours of the sell-off.
The downturn appears primarily driven by renewed regulatory concerns from China, where 13 government departments issued a joint statement reiterating their commitment to combat virtual currency trading and speculation. This announcement echoes the 2021 regulatory crackdown that triggered substantial market declines, creating panic among Chinese market participants.
Compounding the regulatory headwinds, already thin trading volumes exacerbated the selling pressure, while shifting expectations for Federal Reserve policy in December continued to constrain broader market sentiment. With the crucial PCE inflation data release delayed until December 19—after the upcoming FOMC meeting on December 10—market participants are left with limited reliable indicators to gauge the Fed’s policy trajectory, increasing reliance on this week’s ADP employment data for directional cues.
The convergence of these factors suggests digital assets face continued sideways-to-bearish pressure in the immediate term, particularly ahead of the December FOMC meeting where the central bank’s updated dot plot and economic projections will provide critical insight into the 2025 rate path.
Bitcoin is facing a pivotal technical test as it returns to the crucial $86,000 support zone following a failed recovery attempt. The cryptocurrency had staged an impressive 15% rebound from its April low of $80,600, but has since surrendered a significant portion of those gains with a 3% decline in recent trading.
The $86,000 level represents a critical technical inflection point where BTC previously consolidated and established a foundation for its last upward leg. A successful defense of this support could foster another technical rebound, preserving the potential for renewed upward momentum. However, a decisive break below this level would constitute a structural breakdown, potentially triggering a retest of the recent $80,600 lows.
Momentum indicators have shifted notably bearishly. The Relative Strength Index (RSI) is approaching oversold territory, reflecting building selling pressure, while the Moving Average Convergence Divergence (MACD) has completed a bearish death cross and is testing its zero line from above. This configuration suggests the previous bullish momentum has decisively faded.
The convergence of price action at this key support level with deteriorating momentum indicators creates a critical juncture for Bitcoin. Traders should monitor the $86,000 level closely—a sustained break below would likely accelerate selling pressure, while a firm rebound would suggest the broader recovery structure remains intact.
Resistance level: 93,480.00, 101,365.00
Support level: 85,700.00, 77,330.00
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