Bitcoin took a sharp hit in early trading Friday, dropping 5.5% to $61,322 — its lowest level since February 6. The sell-off came as renewed Middle East conflict headlines rattled markets, wiping out the entire rally built over the prior three months. Prices later recovered above $64,000 and settled at $63,300, but the damage was done: over $1.1 billion worth of levered crypto positions were liquidated in the past 24 hours.
The Liquidation Cascade
The 20-day moving average got breached hard, and that set off a $1.85 billion liquidation event that mainly hit leveraged longs. That's a lot of forced selling in a short window. The move erased the entire rally built over the prior three months. The timing isn't great — Bitcoin had been grinding higher, and this flush resets the board.
Support at Risk
Right now Bitcoin is sitting inside its critical support zone, between $60,000 and $65,000. That's a tight range, and price is right in the middle of it. BTC slipped below the Short-Term Holder Realized Price — a pivot traders watch as the line between bullish continuation and a deeper mean-reversion. If BTC closes below $61,000 on a daily basis, the next structural support opens near $58,000. That's a level nobody wants to see tested.
Institutional Shifts
Institutional inflow via spot ETFs has changed character. It shifted from one-directional accumulation to two-way flow, meaning net outflows are now appearing. That's a sign that some big money is stepping back, at least for the moment. It doesn't mean the bull run is over, but the buying pressure has clearly eased.
The Narrative Test
This price drop directly tests the 'digital gold' narrative. For years advocates have pitched Bitcoin as a safe haven, but in this instance it behaved like a risk asset — selling off on geopolitical uncertainty rather than rallying into it. That's a tough look. The market is now watching whether the $61,000–$62,000 zone holds. If it does, a relief rally toward $68,000 is possible. Otherwise, expect consolidation between $62,000 and $65,000 as traders reassess.
