Bitcoin Bulls Vanish as Price Slides Below $78,000: Is the Crypto Correction Just Getting Started?

If you blinked, you missed the Bitcoin bravado. The digital gold that strutted above $80,000 just weeks ago now finds itself nursing wounds below $78,000, its swagger replaced by the cold sweat of weekend liquidity gaps and the awkward silence of bulls who once called every dip a buying opportunity. The latest selloff, triggered by President Trump’s nomination of Kevin Warsh as the next Fed Chair, has left crypto traders in a familiar posture: staring at the tape, wondering if this is just another shakeout or the start of something nastier.

The numbers do not lie. According to Tokenpost and Benzinga, Bitcoin’s price tumbled below $78,000 for the first time since April, dragging Ethereum, XRP, and the entire memecoin zoo with it. BONK, the canine darling of last month, shed a brutal 18% in a single session. Even Dogecoin, usually the last to leave the party, traded flat—an ominous sign when the joke coins stop laughing. Risk-off sentiment is back in vogue, and the algos are not in a forgiving mood.

It was not just crypto that felt the chill. Precious metals, often the safe haven of last resort, also saw a sharp selloff, with gold and silver both sliding as traders braced for a more hawkish Fed under Warsh. The Justice Department’s decision to shelve its probe into Polymarket, the $9 billion crypto-based betting platform, barely registered as a positive catalyst. Instead, attention has shifted to the macro backdrop, where tightening liquidity and rising Treasury issuance are draining risk appetite across asset classes.

The historical parallels are hard to ignore. Bitcoin’s last major correction in April 2024 also coincided with a Fed leadership shakeup and a spike in Treasury yields. Back then, the crypto faithful bought the dip with reckless abandon, and were rewarded as Bitcoin ripped to new highs. This time, the mood is different. Jim Cramer, never one to miss a headline, openly questioned the absence of Bitcoin bulls as the price slipped below $80,000. Even Michael Saylor, the high priest of corporate Bitcoin adoption, waited until BTC dipped below his cost basis before signaling a fresh buy.

The real story here is not just the price action, but the growing disconnect between crypto and traditional safe havens. Bitcoin’s underperformance against gold is being framed by some analysts as a “tremendous opportunity” to scale in, but the data suggests otherwise. Correlations between BTC and risk assets have tightened, not loosened, in the face of macro headwinds. The narrative of Bitcoin as an uncorrelated hedge looks increasingly threadbare when both gold and crypto dump in tandem.

The macro backdrop is not doing crypto any favors. Treasury settlements are draining $64.3 billion from market liquidity, according to Seeking Alpha, and the Treasury General Account (TGA) is rising. Asian currencies are mixed as traders digest Warsh’s nomination, and the Bank of Japan is openly debating whether it is “behind the curve” on inflation. In other words, the world’s central banks are not coming to the rescue any time soon.

Strykr Watch

Technically, Bitcoin is flirting with disaster. The $78,000 level, once considered a floor, has now been breached, opening the door to further downside. The next key support sits at $75,000, with a hard floor near $72,500. Resistance is stacked at $80,000 and $83,500, both of which have seen heavy selling in recent weeks. RSI is trending below 40 on the daily, signaling oversold conditions, but momentum remains negative. Ethereum is holding above $4,000, but only just, while XRP is threatening to break below $1—a psychological level that could trigger further liquidations.

The memecoin sector is in full retreat. BONK’s 18% drop is emblematic of the sector’s fragility. With sentiment this fragile, any bounce is likely to be met with aggressive selling. The only bright spot is MicroStrategy’s STRC dividend, which has risen to 11.25%, hinting at institutional interest—but even that feels like a sideshow when the majors are bleeding.

The risks are not hard to spot. A deeper correction could see Bitcoin test $72,500, invalidating the bull case for a quick recovery. Thin weekend liquidity means any large sell order can trigger a cascade lower. Regulatory risk remains ever-present, especially with the Epstein files dragging crypto founders into the headlines. And if Warsh signals a more hawkish Fed, expect further pain across all risk assets.

Opportunities exist, but they require a strong stomach. Traders looking to scale in should watch for a capitulation wick below $75,000, with tight stops. A breakout above $80,000 could trigger a short squeeze, targeting $83,500 and beyond. For the truly brave, fading the memecoin panic could offer outsized returns—but only if you are willing to catch falling knives.

Strykr Take

This is not the time for heroics. The crypto market is in the midst of a genuine correction, not just a garden-variety shakeout. The absence of vocal bulls is telling. Until Bitcoin reclaims $80,000 with conviction, the path of least resistance is lower. Keep your powder dry, watch for forced liquidations, and do not try to be a hero. The real opportunity will come when the last bull throws in the towel.