Bitcoin fell below $113,000 for the first time in two weeks, sparking $113 million in liquidations. While fears mount, historical patterns suggest this correction could be another setup for a rebound.Bitcoin’s Sudden ReversalBitcoin (BTC) plunged under $113,000 on Monday, just days after notching a record high of $124,176. The sharp sell-off triggered more than $113 million in leveraged long liquidations, shocking traders who had grown accustomed to Bitcoin’s strong momentum.The downturn reflects a mix of macro headwinds, regulatory scrutiny, and shaken investor confidence, but analysts note that the cryptocurrency’s long-term bull trend remains intact.Options Market Signals Extreme FearBitcoin derivatives markets turned sharply bearish as investors rushed to hedge downside risk.The 30-day options delta skew surged to 12%, its highest level in four months.Under normal conditions, the skew oscillates between -6% and +6%. Levels above 10% indicate extreme fear.The last comparable spike, on April 7, preceded a Bitcoin rebound of 40% within a month.This suggests that while panic is currently dominating sentiment, prior extremes have historically given way to significant rebounds.What Triggered the Sell-Off?1. SEC Investigation Into Trump-Linked FirmReports emerged that the U.S. Securities and Exchange Commission (SEC) is investigating fraud and manipulation at Alt5 Sigma, a company tied to World Liberty Financial, co-founded by former President Donald Trump.Trump disclosed $57.4M in earnings from World Liberty earlier this year.The company raised $550M in token sales, while Trump’s son Eric is slated to join Alt5 Sigma’s board.The probe injected new political and regulatory uncertainty into crypto markets.2. Weakness in Tech and AI StocksA 1.5% drop in the Nasdaq 100 weighed on risk appetite after MIT NANDA research revealed that 95% of AI pilot projects across 150 companies failed to deliver meaningful revenue growth.This finding rattled confidence in corporate AI adoption — one of Wall Street’s biggest bullish narratives.3. U.S. Import Tariffs & Economic JittersThe U.S. imposed 50% tariffs on 407 new aluminum- and steel-based products, raising concerns over supply chains and consumer inflation.Economists warn of higher prices on everyday goods such as auto parts and plastics.Investor concerns about the Federal Reserve’s independence and ballooning U.S. deficits pushed demand for gold, with UBS lifting its forecast to $3,700 by 2026.Together, these factors stoked risk aversion across global markets, spilling into Bitcoin.Does This Mark the End of the Bull Market?Despite the turbulence, analysts argue the long-term bull trend remains intact:Fear-driven sell-offs have historically marked attractive entry points.Bitcoin could benefit from stock market outflows, especially as investors seek alternatives to equities and fiat exposure.Structural demand — from ETFs, corporate holdings, and institutional inflows — continues to underpin the market.“There is no evidence that Bitcoin’s bull run has ended. Traders’ fear often overshoots rational expectations,” one analyst noted.Bitcoin’s dip below $113K reflects short-term fear, not structural weakness.With extreme fear flashing in options markets, parallels to April’s correction suggest that $112K could mark a local bottom.If historical patterns repeat, Bitcoin may be positioned for a rebound — potentially catching bears off guard, according to Cointelegraph.
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