Why did Bitcoin drop today? The triple top was broken, falling to 91,000, with institutions reducing positions to take profits.

Bitcoin today fell 1.7% to $90,954, with 24-hour trading volume contracting 5.2% to $46.9 billion. Ethereum plummeted 3.3% to $3,137, and the total market capitalization of cryptocurrencies declined 1% to $3.12 trillion. Technical indicators show that the $94,100 level forms a triple top resistance, holding above the critical support at $90,900. A break below could test $86,970.

Triple Top Resistance Becomes the Last Straw for Bulls

(Source: Trading View)

The primary reason for Bitcoin’s decline today is the failure of the triple top resistance on the technical chart. On the 4-hour chart, Bitcoin’s price consolidates around $92,000, within a descending channel starting from the high of $107,700. The price continues to hold above the 38.2% Fibonacci retracement at $90,900, while repeated resistance near $94,100 forms a clear triple top resistance zone.

A triple top is a classic bearish reversal pattern. When the price fails to break through the same resistance three times, it indicates strong selling pressure at that level and exhausted bullish momentum. Bitcoin’s three attempts near $94,100 all ended in failure, prompting technical traders to doubt whether the upward momentum has vanished. Once this doubt spreads, profit-taking and stop-loss sell orders will surge.

K-line patterns also support this view. Recent trading days show longer upper shadows, spinning tops, and small-bodied candles, indicating hesitation and weakening momentum near resistance. No convincing bullish engulfing or three white soldiers patterns have appeared to confirm a breakout. Structurally, Bitcoin has been making higher lows since the November lows, maintaining a medium-term recovery trend. However, if Bitcoin cannot effectively close above $94,200, this downward move remains a correction within a broader downtrend.

The 38.2% Fibonacci retracement at $90,900 is the most critical support level. This price level is derived from the high of $107,700 to the low of $80,500, representing a key Fibonacci retracement in technical analysis. A break below $90,900 could lead to a test of $86,970 (23.6% retracement), followed by further declines toward the demand zone between $80,500 and $82,000. This stepwise decline provides traders with a clear risk management framework.

Shrinking Trading Volume Indicates Waning Buying Power

The second reason for Bitcoin’s decline today is the significant contraction in trading volume. According to CoinMarketCap data, Bitcoin’s 24-hour trading volume decreased 5.2% to $46.9 billion. More broadly, the total trading volume in the crypto industry fell 14% to $117.4 billion. This combination of price decline with shrinking volume usually suggests that buying strength is waning rather than active selling.

Trading volume is a key indicator to validate price movements. Ideally, upward moves should be accompanied by increasing volume, indicating genuine buying interest. Conversely, when prices hover at high levels with declining volume, it often signals that bulls are gradually retreating. This volume-price divergence is a classic sign of an impending trend reversal. Currently, Bitcoin is in this dangerous divergence state.

Three Major Technical Warnings for Bitcoin’s Decline

Triple Top Resistance Confirmed: Three failed attempts at $94,100 show strong selling pressure and exhausted bulls

Continuous Volume Contraction: 24-hour volume down 5.2%, a typical feature of waning buying power

Weakening K-line Patterns: Long upper shadows and small bodies indicate hesitation, lacking strong breakout signals like bullish engulfing

From a volatility perspective, Bitcoin’s realized volatility has been steadily decreasing over the past week. Low volatility environments often precede trend changes, and the current low volatility may be the calm before the storm. Historical data shows that after prolonged low volatility, Bitcoin often experiences sharp daily swings of 5%-10%, in either direction.

Why Morgan Stanley ETF Application Fails to Boost the Market

(Source: SEC)

The third question about Bitcoin’s decline today is: Morgan Stanley submitted a spot Bitcoin ETF application to the U.S. SEC this week. This should be a major positive, so why did it fail to lift prices and instead lead to a decline? The filing outlines Morgan Stanley’s proposed Bitcoin Trust, which aims to track the spot Bitcoin price net of fees.

Currently, spot Bitcoin ETFs manage over $120 billion, representing a significant portion of Bitcoin’s total market cap. For Morgan Stanley, issuing its own ETF allows closer integration into client portfolios and capturing management fees previously flowing to firms like BlackRock and Fidelity. This marks the birth of the first Bitcoin fund directly initiated by a major U.S. bank.

However, the market’s reaction to this news has been tepid, possibly for three reasons. First, the “priced in” effect. Rumors of Morgan Stanley’s ETF application have circulated for weeks, and the price may have already reflected this expectation in advance. When the official announcement arrives, it becomes a “sell the news” event. Second, ETF approval can take months, so no immediate substantial capital inflow is expected. Third, institutional investors might be “selling the news,” reducing their holdings upon positive developments to lock in profits.

The U.S. 10-year Treasury yield was at 4.134% at 3 p.m. (Eastern Time) Wednesday, down from 4.175% on Tuesday; the 5-year Treasury yield fell from 3.717% to 3.689%. Falling bond yields typically indicate rising risk aversion and capital flow into safe assets. In this macro environment, Bitcoin, as a risk asset, faces selling pressure.