Bitcoin (BTC) plunged to a fresh 120-day low of $82,250 on February 28 amid a sweeping sell-off in U.S. tech equities, sending shockwaves across the broader crypto market. The decline marks a sharp reversal for BTC, which had been trading above $86,000 earlier in the week. With Bitcoin ETFs hemorrhaging $2.1 billion in outflows over six consecutive days and investor capital flooding into AI-driven tech stocks like NVIDIA, the short-term outlook for Bitcoin has turned increasingly bearish.
Market Shift: From Crypto to AI Stocks
Bitcoin’s losses in February have now surpassed 20%, making it the worst monthly performance since the FTX collapse in November 2022. While macroeconomic concerns—such as sticky inflation, geopolitical tensions, and protectionist trade policies—have contributed to the downturn, a major catalyst emerged from an unexpected source: NVIDIA’s blockbuster Q4 earnings.
On February 26, 2025, NVIDIA reported $39.3 billion in revenue—a 12% increase quarter-over-quarter and a staggering 78% year-over-year jump. Earnings per share (EPS) surged to $4.93 (GAAP) and $5.16 (non-GAAP), fueling a 4% spike in its stock price and adding over $125 billion to its market cap in a single session.
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This rally intensified capital rotation out of speculative assets like Bitcoin and into high-growth equities. On the same day, BTC dropped 5%, falling from $86,680 to $82,256—a clear signal that institutional and retail investors alike are prioritizing proven tech performance over crypto volatility.
Bitcoin ETF Outflows Signal Institutional Retreat
The most alarming development for Bitcoin’s price stability is the sustained withdrawal of institutional capital from Bitcoin ETFs. Data reveals six straight days of outflows totaling $2.1 billion between February 18 and February 25.
Here’s a breakdown of the daily outflows:
- Feb 18: -$60.7M
- Feb 19: -$64.1M
- Feb 20: -$364.8M
- Feb 21: -$62.9M
- Feb 24: -$539.0M
- Feb 25: -$1.14B
This accelerating trend underscores a growing preference for traditional equity exposure, particularly in AI and semiconductor sectors. As long as NVIDIA and similar stocks continue to deliver strong returns, Bitcoin may struggle to attract fresh inflows.
The absence of institutional buying weakens BTC’s support structure, increasing vulnerability to further downside pressure. If outflows persist, Bitcoin could test the $80,000 psychological threshold—a level that has historically acted as both support and resistance.
Technical Outlook: Bearish Momentum Builds
Bitcoin is currently trading at $84,784, down 20.53% over the past 26 days. Technical indicators confirm the bearish momentum:
- Bollinger Bands (BB): Price is hovering near the lower band at $86,736, while the upper band sits at $102,907—highlighting extreme downside volatility.
- Relative Strength Index (RSI): Dropped to 25.92, a deeply oversold level not seen in months. While this historically precedes short-term rebounds, the continued downward trend in RSI suggests selling pressure remains dominant.
For bulls to regain control, BTC must first stabilize above $84,500** and reclaim key resistance at **$86,736 (lower Bollinger Band). A daily close above this level could trigger a relief rally toward $90,000.
However, failure to hold above $84,000 may accelerate losses, potentially driving Bitcoin toward **$80,000 or lower in the coming sessions. The mid-Bollinger Band at $94,822** now serves as strong resistance—only a decisive break above this level would signal a reversal of the current downtrend.
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Key Risk Factors Ahead
Several macro and market-specific factors could determine Bitcoin’s next move:
- AI Stock Momentum: If NVIDIA and other tech giants continue their rally, capital may remain diverted from crypto.
- ETF Flow Trends: Any resumption of inflows into Bitcoin ETFs could stabilize prices and restore investor confidence.
- Macro Data Releases: Upcoming U.S. inflation reports and Fed commentary will influence risk appetite across asset classes.
- Geopolitical Stability: Escalating global tensions could either boost BTC as a hedge or trigger broader risk-off behavior.
Frequently Asked Questions (FAQs)
Why is Bitcoin price falling so sharply?
Bitcoin’s decline is driven by a combination of institutional ETF outflows, capital rotation into high-performing AI stocks like NVIDIA, and broader macroeconomic uncertainty affecting risk assets.
Can Bitcoin recover from this downturn?
A recovery is possible if ETF outflows slow and BTC stabilizes above $84,500. A daily close above $86,736 could spark a short-term rally toward $90,000. However, continued selling pressure increases the risk of a drop below $80,000.
What level is critical for Bitcoin to avoid further losses?
Bitcoin must hold above $84,500** to prevent deeper corrections. A break below **$80,000 could trigger extended selling, especially if technical support fails and sentiment turns more negative.
How do NVIDIA’s earnings affect cryptocurrency markets?
NVIDIA’s strong earnings highlight investor preference for tangible tech growth over speculative digital assets. When big tech delivers outsized returns, capital often shifts away from volatile markets like crypto.
Are oversold conditions a buying opportunity?
An RSI below 30 indicates oversold conditions, which historically precede rebounds. However, in strong downtrends, oversold readings can persist. Traders should wait for confirmation—such as rising volume on up-days—before assuming a reversal.
What should investors watch next?
Key indicators include Bitcoin ETF flow data, U.S. macroeconomic reports, and technical price action around $84,500 and $86,736. Any shift in institutional sentiment could quickly alter the trajectory.
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Final Thoughts: A Crossroads for Bitcoin
Bitcoin stands at a critical juncture. The confluence of massive ETF outflows, macro uncertainty, and investor enthusiasm for AI equities has created a perfect storm for downside pressure. While technical indicators suggest a potential short-term bounce from oversold levels, the structural trend remains bearish.
The next few sessions will be decisive. If Bitcoin fails to reclaim $86,736 and ETF redemptions continue, a test of the $80,000 level appears increasingly likely. Conversely, any sign of stabilizing flows or renewed institutional interest could spark a countertrend rally.
For traders and long-term holders alike, vigilance is key. Monitoring ETF data, macro developments, and technical resistance levels will be essential in navigating this volatile phase.
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