Bitcoin has fallen to its lowest level since mid-August as a wave of leveraged position liquidations swept through crypto markets ahead of this week’s critical US inflation data. According to reporting by Cointelegraph, the world’s largest cryptocurrency dropped below $74,000 late Sunday, extending losses from the previous week before briefly recovering above $75,000.

The sell-off reflects mounting pressure on overleveraged traders. CoinGlass data showed $1.12 billion in leveraged positions were liquidated across a 24-hour period through Monday morning, signalling cascading losses as Bitcoin broke through key technical support levels. The asset has now fallen below both its 50-week simple moving average at $75,492 and its short-term holder cost basis of $75,691, according to CryptoQuant metrics.

Technical Breakdown Signals Potential Bottom

Bitcoin’s technical indicators offer conflicting signals about whether a floor has formed. The cryptocurrency has dipped below its 21-week simple moving average at $73,078, a level that has previously held during downturns. Traders tracking recent buyer profitability note that coins acquired one to three months ago sit underwater at an average cost basis around $79,300—a psychological resistance level if holders capitulate.

Rekt Capital, a prominent trader, cautioned that volume patterns suggest further selling could come before exhaustion. “Seller exhaustion tends to happen exactly at or very close to a Bitcoin price bottom,” the analyst noted on X (formerly Twitter), implying that current price action may not represent final capitulation.

Historical precedent provides some reassurance. CryptoQuant community analysts observed that Bitcoin frequently tested similar support zones for extended periods before reclaiming them, citing February-to-August 2026 as a comparable example. Yet without evidence of sustained buying interest, the short-term trajectory remains uncertain.

Inflation Reports and Oil Dynamics Set the Stage

The timing of Bitcoin’s weakness is no accident. US inflation data has historically moved markets sharply, and this week brings two critical readings: the October Consumer Price Index on Tuesday and Producer Price Index on Friday, both at 8:30 am ET. Both reports carry outsized weight as policymakers assess whether inflation remains sticky above target levels.

Economist Robin Brooks offered a contrarian lens on the relationship between crude oil prices and Bitcoin. With West Texas Intermediate crude trading near $90 a barrel amid Middle East tensions, Brooks argued that a decline in oil could unlock upside for risk assets including Bitcoin. He suggested oil could fall to $75 a barrel if geopolitical premiums moderate.

“I think there’s a lot of downside for oil and I think that means upside for gold, for silver, the S&P 500 and for Bitcoin,” Brooks wrote. The economist added that falling oil prices could reduce systemic inflation expectations, potentially altering the Fed’s calculus on rate hikes.

The Federal Reserve itself dominates near-term sentiment. CME Group’s FedWatch Tool currently prices 78.8% odds that the central bank will raise rates by 25 basis points at its December meeting—a probability that could shift sharply depending on Tuesday and Friday’s inflation data. Fed officials including Governor Christopher Waller and Vice Chair Michelle Bowman are scheduled to speak this week, offering fresh commentary on their inflation outlook.

Tech Contagion and Broader Market Stress

Bitcoin’s weakness has not unfolded in isolation. Nvidia’s announcement Sunday that its board had launched an independent investigation into alleged foreign intelligence targeting of CEO Jensen Huang rattled equity markets. While the company stated it had no evidence of compromised US national security or proprietary information, the news sparked wild swings in Nasdaq 100 futures.

Economist Mohamed El-Erian flagged the governance risk as particularly acute. “The company is systemically important for tech, markets and the economy; investors tend to struggle to price in key-person and governance issues; and there are fluid national security and geopolitical dynamics,” he wrote. The Nasdaq 100 oscillated between gains and losses Monday as investors reassessed tech sector exposure.

South Korea’s Kospi benchmark fell 0.8% to 5,018.85 Monday, extending pressure from Friday’s circuit breaker halt when the index plunged over 8% at the open. Seoul’s Vice Minister of Science and ICT Ryu Jemyung assured a parliamentary committee that contracted Nvidia chip deliveries remain on track, a signal that supply chain concerns may be overblown.

For Bitcoin traders, the convergence of liquidations, technical breaks, and macro uncertainty has created a dangerous setup. The week ahead will test whether Bitcoin can stabilize above current levels or whether further capitulation awaits.