Bitcoin remains under pressure after a pronounced selloff last week, according to research from digital asset investment firm Hilbert Group. The firm points to renewed geopolitical tensions, concerns about an artificial intelligence valuation bubble and signs of tightening global liquidity as forces that have reduced appetite for riskier assets.
The move underscores Bitcoin's sensitivity to shifts in macroeconomic and geopolitical conditions. Hilbert noted that higher oil prices, escalating uncertainty abroad and worries over stretched technology valuations have all contributed to a pullback in risk assets, including digital currencies. The market is also focused on the Federal Reserve's upcoming policy announcement - a potential driver of liquidity conditions - and how persistent inflation and resilient economic growth might influence future rate decisions.
Price action over the past week illustrated the volatility. Bitcoin fell 5.4% after reaching $84,800 early in the week, suffering five consecutive daily declines and briefly slipping beneath $80,000 to trade as low as $79,200 over the weekend. Hilbert Senior Portfolio Manager Jesse Marre flagged $75,500 as a pivotal level, warning that a breakdown below that point could undermine the bullish base that had formed since summer lows.
The weakness in crypto markets occurred alongside a broader retreat in risk-taking. Renewed tensions involving Iran pushed Brent crude toward $117 a barrel amid speculation around a possible U.S. military offensive. Oil prices later retreated after U.S. President Donald Trump said no immediate offensive was planned, though Hilbert noted that prices remained elevated.
Technology stocks were under similar pressure as investors reevaluated valuations in the artificial intelligence space. Nvidia shares fell 8% over the week, while Meta Platforms declined 9%. The Nasdaq Composite dropped about 2% during the week, following an intraw eek decline of roughly 3.6%, while the S&P 500 fell 1%, according to Hilbert's October 26 market update.
From a technical standpoint, Bitcoin is testing support in the $78,500 to $79,500 range. Hilbert's analysis suggested that a recovery above $81,400 would help restore near-term stability. To shift the outlook toward a renewed rally, the firm said moves above $85,000 and $87,500 would be necessary, and that a sustained breakout past $87,500 could potentially open a path toward $95,000-$98,000.
Tighter liquidity conditions are adding to downside pressure on digital assets. Hilbert's global liquidity index registered 3.06, while its six-factor model recorded a weekly decline of 0.47 in its Z-score, signaling weakening liquidity momentum.
Fund flows provided a mixed picture. Bitcoin exchange-traded funds saw net inflows totaling $442 million over the week, even as they experienced $635 million in outflows on Thursday alone. Hilbert interpreted those patterns to indicate that ETF flows largely followed spot-market moves rather than serving as the primary driver of price changes.
Market participants are now focused on the Federal Reserve's policy decision on Wednesday. Markets were pricing in an 87% probability that the central bank would leave interest rates unchanged, and Hilbert expects a hawkish hold - meaning officials may keep the option of a December rate increase open in light of persistent inflation and ongoing economic resilience.
Traders and investors will also be watching several U.S. economic releases that could influence monetary policy expectations: personal consumption expenditures inflation and gross domestic product data due on Thursday, followed by the Chicago purchasing managers index on Friday. Hilbert noted that these reports could shape expectations for policy and determine whether the current pressure on risk assets continues.
In sum, Hilbert's update painted a picture of a market contending with multiple headwinds - higher oil prices tied to geopolitical risk, valuation concerns in the AI and tech sectors, and fraying liquidity dynamics - all converging as a critical central bank decision and fresh economic data loom.
Author: Priya Menon