Analysis: Bitcoin falls below $84,000 as IBIT and BITO drop more than 3%

Bitcoin fell below $84,000 to roughly $83,300 to $83,600 on Wednesday, down about 3% to 3.5%. Bitcoin repeatedly failed to break through the $87,000 area before the decline. The ProShares Bitcoin Strategy ETF (BITO) and iShares Bitcoin Trust ETF (IBIT) both fell more than 3%. Bitcoin-linked ETFs were among Wednesday's most actively traded funds. IBIT trading volume reached 35.6 million shares, indicating substantial activity and investor interest. The heavy trading underscored how quickly investors have been repositioning as Bitcoin retreats from the $87,000 area.

A worsening macroeconomic backdrop drove Bitcoin's latest decline. The 10-year Treasury yield climbed to 2002 highs. The U.S. dollar strengthened toward the dollar's highest level since April 2025. Brent crude approached $102 a barrel as Middle East tensions pushed oil prices higher. Rising real yields and a stronger dollar can make speculative assets such as Bitcoin less attractive.

The TFTC ETF-flow tracker recorded $118.9 million in net inflows into U.S. spot Bitcoin ETFs on Tuesday. The tracker recorded about $122 million in inflows into IBIT. U.S. spot Bitcoin ETFs recorded $89.9 million in outflows on Monday. The mixed flows show that institutional demand has been uneven. The bigger concern may be whether Bitcoin's latest weakness develops into sustained ETF redemptions.

The short-term technical setup has weakened considerably. Benzinga Pro indicates that IBIT support appears to be forming around $46.80, matching the intraday low. A break below $46.80 could signal further declines, with the next support likely near $42, where buying interest may increase. IBIT's recent high of $47.34 could limit upward momentum. A recovery above $47.34 may attract additional buying interest and potentially lead to a test of the upper end of IBIT's 52-week range.

BITO's 14-day relative strength index was around 36.9, close to oversold territory. However, BITO remained above the fund's 20-, 50-, 100- and 200-day moving averages. BITO's 200-day moving average was around $10.88. The recent selloff has damaged short-term momentum but has not yet completely broken BITO's longer-term uptrend.

Analysts cited by Barron's identify $83,000 as Bitcoin's immediate downside level. A decisive break below $83,000 could push Bitcoin toward $80,000. A recovery through roughly $86,500 to $87,000 would signal that buyers are beginning to absorb macroeconomic pressure. The next few sessions could depend more on whether Bitcoin can defend $83,000 than on developments within BITO and IBIT. A rebound above $87,000 would restore the bullish outlook. A fall below $83,000 could make the recent pullback considerably deeper.