Will the Bull Live On? What Bitcoin Needs to Bounce Back

Bitcoin’s resilience is being tested as it slips below the $100,000 mark, but analysts say all is not lost, provided three crucial factors align.

Bitcoin (BTC) has had a rough week, falling more than 8% and briefly dipping under $100,000 for the first time since June. The decline, amounting to roughly 20% from its October record high, coincided with a sell-off in AI-related stocks that triggered wider risk aversion across global markets.

Despite the sharp pullback, analysts believe Bitcoin’s broader bullish structure remains intact if it can maintain support above a critical technical level and if U.S. liquidity conditions turn more favorable in the coming weeks.

1. Holding the 200-Week EMA

Bitcoin’s long-term bullish trend hinges on its ability to stay above the 200-week exponential moving average (EMA), currently near $100,950. This level has served as a historic floor during every major correction since late 2023, consistently marking the bottom of market drawdowns.

On the weekly chart, Bitcoin continues to defend this trendline even after a 22% drop from its recent peak. Its relative strength index (RSI) is also hovering near 45, a zone that has typically signaled the start of major recoveries in the past.

As long as BTC maintains these two supports, analysts say the macro bullish structure remains intact. A break below both, however, could confirm a deeper, longer-lasting bear phase.

2. The Fed’s “Stealth QE” Could Revive Liquidity

Former BitMEX CEO Arthur Hayes argues that U.S. fiscal and monetary dynamics will soon force the Federal Reserve into a new round of balance sheet expansion what he calls “stealth quantitative easing.”

The U.S. is currently running an annual deficit close to $2 trillion, financed primarily through Treasury issuance. But traditional buyers like foreign central banks and domestic investors are absorbing less of that debt, leaving hedge funds to fill the gap often using short-term repo loans backed by Treasurys as collateral.

When cash supply tightens, the Fed’s Standing Repo Facility quietly steps in to inject dollars into the system. Hayes believes this process effectively mimics QE by increasing liquidity behind the scenes.

“If the Fed’s balance sheet grows, that’s positive for dollar liquidity—and by extension, for Bitcoin and other risk assets,” Hayes said in a recent analysis.

3. U.S. Liquidity Could Improve After the Government Shutdown

The final factor hinges on Washington. Ongoing fiscal deadlock and the partial U.S. government shutdown have constrained liquidity, weighing on risk sentiment. The Treasury continues to issue large volumes of debt while its Treasury General Account sits roughly $150 billion above target, keeping funds locked out of the financial system.

That liquidity drain, analysts say, is one of the reasons behind Bitcoin’s latest decline.

However, prediction markets like Polymarket show increasing confidence that the shutdown will end soon. Bets on a resolution between Nov. 8 and 11 have surged from 22% to 36%, while odds for a Nov. 12–15 resolution also rose sharply.

Once spending resumes and liquidity returns to the market, Hayes believes the next leg of Bitcoin’s rally could begin.

“The system only has two modes: print money or destroy money,” Hayes wrote. “Right now, it’s destroying. But not for long.”

Bottom Line

Bitcoin’s path forward depends on a delicate balance of technical resilience and macro liquidity. If the cryptocurrency can hold above its 200-week EMA while the Fed quietly expands liquidity and the U.S. shutdown ends, analysts say it could avert a deeper bear market—and potentially set the stage for the next major rally.