BTC Drops Below $106,000: Macro Drivers and Market Outlook

Recently, the BTC price fell below $106,000, partly due to the global market’s insufficient expectations for a new round of trade negotiations between China and the US, with US stock futures slightly declining and risk assets under pressure.

Macroeconomic background of the support level falling

Before the release of the US employment data in May, the market’s divergence over the Federal Reserve’s interest rate hike path increased, leading to a decline in risk appetite, while China’s industrial data also fell short of expectations, further suppressing demand for crypto assets.

Policy and geopolitical influences

In March, the United States signed the “Strategic Bitcoin Reserve and Digital Asset Reserve Order,” incorporating over 200,000 seized bitcoins into the national reserve, which increased institutional attention on digital assets; however, the recent public dispute between Trump and Musk has raised concerns in the market about policy uncertainty.

Capital flow and exchange dynamics

On-chain data shows that the balance of Bitcoin exchanges has continued to increase over the past two weeks, indicating that more long-term holders are choosing to take profits within the current price range; at the same time, the leverage trading volume on several leading exchanges has also declined, with a significant reduction in leveraged long positions. .

Market Outlook and Risk Warning

Despite short-term pressure, multiple institutions predict that BTC still has significant upside potential in the second half of the year, with target price levels looking towards the $120,000–$125,000 range; beginners should focus on key support levels and policy dynamics, combining dollar-cost averaging strategies with stop-loss settings to manage positions and risks effectively.