Bitcoin prices slumped below the $113,000 threshold in midweek trading, extending losses as inflation concerns in the United States and a sharp sell-off in technology stocks rattled investor sentiment across financial markets.
The world’s leading cryptocurrency fell beneath a key upward trendline established since early April, closing under its 50-day Exponential Moving Average (EMA) of $114,903. The move marked Bitcoin’s first monthly loss since March, interrupting a four-month rally that had seen the digital asset soar by 66% from cycle lows to a record high of $124,517 on August 14.
Market analysts attributed the downturn to renewed macroeconomic jitters. A stronger-than-expected U.S. Producer Price Index (PPI) report weakened expectations for aggressive Federal Reserve rate cuts later this year. As risk appetite faltered, cryptocurrency valuations mirrored the slump in overvalued tech stocks, forcing leveraged traders to unwind positions.
According to market trackers, more than $500 million in Bitcoin positions were liquidated in a single day, pushing the asset to an overnight low of $112,580 — a 9.5% drop from its August peak. Ether also fell sharply, consolidating within the $4,100–$4,000 support range.
Technical indicators reflected deepening bearish momentum. The Relative Strength Index (RSI) hovered at 41, below the neutral 50 level, while the MACD signaled a bearish crossover, confirming downside risk. Despite gold reaching historic highs on safe-haven demand, Bitcoin has struggled to sustain its “digital gold” narrative, remaining closely tied to risk-sensitive assets.
Nevertheless, institutional flows continue to underpin Bitcoin’s long-term outlook. From a February low of $81,975, the cryptocurrency has climbed nearly 39%, consolidating near cycle highs despite distribution from institutional players. Current market capitalization stands at $2.26 trillion, with Bitcoin’s dominance at 58%, signaling its continued leadership in the crypto ecosystem even as altcoins gain marginal ground.
Analysts caution that the Federal Reserve’s upcoming September meeting could prove pivotal for Bitcoin’s trajectory. With institutional profit-taking creating near-term headwinds, traders are eyeing the $112,000 support level as critical for sustaining momentum in the world’s largest cryptocurrency.
