Economic uncertainty, Nvidia’s upcoming earnings, and a large BTC options expiry are negatively pressuring Bitcoin prices.
BTC $86,400 fell to $83,500 on Feb. 26, marking its lowest price since November 2024. This $12,820 drop over three days wiped out over $1 billion in leveraged long positions, based on CoinGlass data. Analysts point to growing fears of a global economic recession as the main driver of this bearish mood. However, pressure from derivatives markets and weaker corporate earnings is also keeping Bitcoin below $90,000.
The sell-off aligns with news of US President Donald Trump pushing for tariffs on imports from Canada and Mexico. This has driven investors toward long-term US Treasurys for safety. Even gold, often seen as a trusted store of value during uncertain times, dropped 2.2% in two days. It fell from an all-time high of $2,956 on Feb. 24, reflecting broader market unease.
Unlike well-funded Big Tech firms, Bitcoin offers no dividends or clear way to benefit during an economic downturn, such as acquiring smaller competitors at low prices. As a result, the S&P 500 serves more as a hedge than a high-risk investment. Analysts like John Butters from FactSet project a strong 16.9% year-over-year earnings growth for the fourth quarter.
Meanwhile, critics argue that Strategy (formerly MicroStrategy) single-handedly pushed Bitcoin’s price to $100,000. However, there’s no certainty that the company can keep raising funds. Strategy’s shares have dropped 19.4% in seven days, signalling investor scepticism about its plan to secure a $42 billion capital increase over three years. This raises doubts about Bitcoin’s ability to hold its value without such backing.
BTC needs positive economic signals, AI bubble fears aren’t helping
For Bitcoin to climb back to $95,000, traders are looking for positive economic signals. Artificial intelligence giant Nvidia will release its quarterly earnings after the market closes on Feb. 26. Many traders fear that the company might struggle due to global tariff conflicts and US export restrictions on processing chips to China. Concerns about an AI bubble are also reducing investors’ appetite for risk, as shown by US 5-year Treasury yields dropping to their lowest level since December 2024.
High demand for fixed-income assets, combined with a sharp rise in gold prices, often points to market fear. This is troubling for Bitcoin, especially after outflows from the spot Bitcoin ETFs exceeded $1.1 billion on Feb. 24 alone, according to Farside Investors data. The wave of panic selling has damaged trust, as investors expected big institutions to handle Bitcoin’s volatility and view it as a buffer against a potential economic downturn.
The upcoming $6.9 billion Bitcoin monthly options expiry on Feb. 28 is pushing traders to expect a lower price. Bulls were caught off guard, even though put (sell) options open interest is $530 million below call (buy) options. For example, out of the $3.7 billion in call options, less than $60 million are set at $88,000 or below.
This gives bears a clear reason to pin Bitcoin price under $88,000 before the expiry at 8:00 am UTC. With call options likely to underperform and market risk concerns growing, bulls lack the firepower to turn things around.
Pushing Bitcoin back to $95,000 after the options mature seems out of reach, as the most likely outcome is not favourable for bulls, and confidence remains limited.
Source: Cointelegraph
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