Bitcoin has dropped to its lowest level in several months amid structural capital outflows from the market, according to NYDIG research. The firm's analysis shows spot ETF flows reversed in early October, digital asset treasury premiums declined, and stablecoin supply contracted. These indicators point to systemic liquidity withdrawal rather than panic-driven selling.

Short-term Bitcoin holders capitulated as BTC declined to test $80,000 support, marking a 36% drop from its October peak. On-chain data show investors holding for under 155 days shifted sentiment from positive to negative, a pattern previously observed near local market bottoms within the current cycle.

U.S. authorities investigated Bitmain-manufactured Bitcoin mining hardware over potential remote manipulation and power grid vulnerabilities. The Department of Homeland Security-led inquiry resulted in detention and inspection of Antminer S21 and T21 units at multiple ports. Bitmain denied the allegations, stating it cannot remotely operate its machines and has no government connections.

Bitcoin is trading around $87,000 following a sharp sell-off that triggered $66.52 million in liquidations, with short positions accounting for $43.53 million of losses. The Relative Strength Index has dropped to levels seen only six times in Bitcoin's history, conditions that have historically preceded strong reversals. Analysts remain divided on the outlook, with some projecting potential declines toward $40,000 based on monthly MACD patterns, while others view current conditions as a long-term accumulation zone.

Bitcoin rebounded to $87,000 following a week that saw the cryptocurrency approach $80,000 support levels. The weekend rally lifted smaller digital assets, though historical data shows weekend trading volumes run 20% to 25% lower than weekdays, according to research published by Advances in Consumer Research in August. This creates thinner market conditions where momentum-driven trades exert greater price impact.

Bitcoin tested $88,000 twice in recent hours but retreated from that level both times. The cryptocurrency traded near $87,000 after recovering from last week's decline below $82,000. Market expectations for a Federal Reserve rate cut in December have increased, supporting the rebound.

Bitcoin traded at $87,986 on Monday after recovering from Friday's intraday low of $80,553. The token has fallen more than 10% in November, marking its steepest monthly decline since November 2022 when the FTX exchange collapsed. Markets are pricing in a nearly 70% probability of a 25-basis-point Federal Reserve rate cut on December 10, up from 44% a week earlier, according to the CME FedWatch Tool.

Bitcoin recovered above $87,000 after a sharp decline pushed its 14-day RSI to 22.65, a level historically linked to selling exhaustion. The asset now trades near $86,900 but remains below its 50-day and 200-day moving averages at $107,482 and $105,108. The Fear & Greed Index stands at 13, reflecting extreme market pessimism.