Bitcoin, Ethereum Down 2% Despite Retail Rotation: What's Going On?

Bitcoin (CRYPTO: BTC) and Ethereum (CRYPTO: ETH) saw $1.4 billion in liquidations over the past week as retail capitulates on altcoins and rotates back into majors.

What Happened: Bitcoin slipped below $85,000 mid-week before grinding back to $90,000 by the end of last week, though it has failed to follow through this week.

Ethereum dropped below $3,000 as liquidations hit $600 million Monday, then another $400 million on Wednesday and Thursday, respectively

The damage was severe but short-lived. 

Overleveraged positions got wiped out quickly, forcing traders to retreat into Bitcoin and Ethereum—the only assets with enough liquidity to absorb the shock.

Retail Rotates Out Of Altcoins As TradFi Keeps Building Positions

According to a new report by market-making firm Wintermute, institutions have been net buyers since summer.

Wintermute’s internal flow data shows retail is now dumping altcoins and buying BTC and ETH instead.

Altcoins such as Solana (CRYPTO: SOL), XRP (CRYPTO: XRP) and Cardano (CRYPTO: ADA) continue to underperform, crushed by supply overhangs and a packed token unlock schedule.

Traditional finance players continue entering crypto despite the volatility.

This steady institutional buying should support prices over the next few months, even if short-term rallies remain muted.

Year-End Outlook: Range-Bound Until Catalysts Hit

Liquidity is drying up as trading desks shut down for the holidays.

The market needs a clear catalyst—either a major macro shift or new policy news—to break out of this range. 

Until then, expect sideways action through the holidays with any real momentum likely delayed until January.

Bitcoin Chart: Triangle At Breaking Point

BTC Price Action By TradingView

Trader notes: Bitcoin is testing the lower boundary of a descending triangle that’s been compressing price since October.

Support sits at $84,000-$86,000—the triangle’s floor tested repeatedly since mid-November. 

A break below $84,000 likely triggers stops and opens the door to $80,000 or lower, with some traders eyeing $76,000-$78,000.

Resistance stands at $92,000-$93,000 initially, but the real test is $98,000-$100,000 where the 100 and 200-day EMAs converge. 

Bitcoin needs to clear that zone to shift from bearish to neutral.

Read Next:

• Cardano’s Hoskinson Says ‘Time to Get Cooking’ With Solana: Is A SOL-ADA Cooperation Coming?

Image: Shutterstock