TLDRBitcoin dropped below $91,000, reaching its lowest level since November 2024Trump’s new tariff announcements sparked market uncertainty and inflation fearsInstitutional demand waned with $552.5 million in Bitcoin ETF outflowsThe crypto market lost 8% of its total value, dropping from $3.31 trillion to $3.09 trillionTechnical analysis shows Bitcoin testing a critical support zone between $90,000-$92,000Bitcoin’s price has fallen below $91,000 as of February 25, 2025, hitting its lowest level since November 2024. The leading cryptocurrency dropped over 4.5% in a 24-hour period, part of a broader market decline that saw the total cryptocurrency market cap shrink by 8% from $3.31 trillion to approximately $3.09 trillion.Monday’s nearly 5% decline marked the steepest single-day drop since January 25, when Bitcoin lost over $5,000 in value. This downturn wasn’t limited to Bitcoin, as Ethereum fell 8.5% to below $2,500 and XRP dropped 9% to $2.25. Dogecoin also slumped to November 2024 lows.The sell-off triggered nearly $1 billion in liquidations across the crypto market, with long Bitcoin positions accounting for over $277 million of that total. The market has been trading in a tight range between $91,000 and $102,000 for almost 90 days, showing what Bitfinex analysts describe as a “critical juncture” for the cryptocurrency.Technical AnalysisTechnical analysis indicates that Bitcoin is testing the lower boundary of its three-month consolidation range, which sits between $90,000 and $92,000. The last time Bitcoin interacted with this level in early February, it did not lead to a major upward correction. If this support level breaks, the next target could be the 200-day exponential moving average (EMA) located just below $86,000.Bitcoin Price on CoinGeckoOne of the main triggers for Bitcoin’s recent price drop was U.S. President Donald Trump’s announcement about new tariffs. During a news conference with French President Emmanuel Macron on February 24, Trump confirmed that his administration’s planned 25% tariffs on imports from Canada and Mexico will proceed as scheduled. Additionally, a 10% tariff on Chinese goods has been announced, adding to market concerns.These tariff announcements have sparked fears of increased inflation, potentially undoing progress made in disinflation over the past two years. This uncertainty has pushed investors away from risk assets, including cryptocurrencies, as they reassess their positions in light of changing economic conditions.Bitcoin’s price movements are increasingly correlated with traditional financial markets, a trend highlighted in Bitfinex’s February 24 Alpha report. The S&P 500 has fallen 2.3% over the past five trading days, while the Nasdaq Composite has dropped 4% during the same period. This suppression in broader equity markets has dragged down risk assets across the board.Another important factor in Bitcoin’s fall is the decline in institutional demand through spot exchange-traded funds (ETFs). Bitfinex reported outflows totaling $552.5 million from Bitcoin ETFs for the week ending February 21, marking a consistent trend of withdrawals. This pullback suggests that large investors are either taking profits or reallocating capital amid the uncertain market environment.The market sentiment has been further dampened by commentary from influential figures in the crypto space. Crypto influencer and former BitMEX CEO Arthur Hayes warned of an impending “goblin town” for Bitcoin, a term signaling a severe price crash. Hayes pointed to hedge funds holding positions in BlackRock’s iShares Bitcoin Trust (IBIT) as a potential trigger for further decline.According to Hayes, these funds have gone long on IBIT while shorting CME Bitcoin futures to earn a yield higher than short-term U.S. Treasuries. However, as Bitcoin’s price falls and the basis (the difference between spot and futures prices) narrows, these funds may unwind their positions by selling IBIT and buying back futures. Hayes predicts this could push Bitcoin down to $70,000, a level he sees as increasingly likely during U.S. trading hours.#Bitcoin goblin town incoming:Lots of $IBIT holders are hedge funds that went long ETF short CME future to earn a yield greater than where they fund, short term US treasuries.If that basis drops as $BTC falls, then these funds will sell $IBIT and buy back CME futures. These… pic.twitter.com/3PskTxrBPR— Arthur Hayes (@CryptoHayes) February 24, 2025Markus Thielen, the CEO of 10x Research, commented that “Bitcoin has broken the critical $95,000 level, a move that could have major implications in the coming weeks. With several key factors at play, this is not the time for complacency—market dynamics are shifting, and traders should remain vigilant.”The lack of momentum required for a sustained breakout has led to a period of contraction and consolidation across almost all major crypto assets. This stagnation, combined with external pressures like tariffs and declining consumer sentiment, has left Bitcoin vulnerable to sharp declines.A February 21 University of Michigan Consumer Survey found that U.S. consumer sentiment in February fell 10% from January to a 15-month low. This decline reflects growing concerns about inflation and economic uncertainty that could slow spending, adding another layer of pressure to the crypto market.Despite the current downturn, bitcoin still maintains a strong buy order accumulation at current levels, which could make it difficult for sellers to push through the current support zone. If the $90,000 level holds, a rebound could follow; if it breaks, further declines may occur before any recovery.Investors are now watching whether this dip represents a buying opportunity or the start of a deeper correction. The cryptocurrency’s fate may hinge on how markets digest Trump’s tariffs and whether institutional demand rebounds in the coming weeks.For now, the market awaits clarity on U.S. economic policies and their potential impact on inflation concerns. Any reduction in these fears, combined with a return to risk-on sentiment in global markets, could help drive a recovery for Bitcoin and the broader cryptocurrency market.The current Bitcoin price stands at $90,572 as of this writing, and the market remains highly volatile as traders adjust their positions in response to the changing economic landscape and market dynamics.The post Bitcoin (BTC) Price: Tests Critical Support at $90,000 Following Three Months of Consolidation appeared first on Blockonomi.