According to the latest Bitcoin Rainbow Chart, Bitcoin’s price has dropped into areas that long-term valuation models have historically identified as “fire sale” levels. The sentiment-laden terminology — frequently exchanged in jest within bitcoin communities — now carries a more serious implication during one of the most profound corrective phases in recent cycle history. The Bitcoin Rainbow Chart serves as a long-term logarithmic valuation tool, showcasing price against a spectrum of colored bands that have historically been interpreted as oversold, fairly valued, or overbought. Following a prolonged downturn from its peak levels, Bitcoin’s price currently resides within a range typically linked to significant undervaluation — often referred to as “fire sale” territory.
As of now, BTC is facing challenges at the $83,000 mark, following several months of consistent sell-offs. BTC has experienced a significant decline, losing approximately 30% of its value since early October 2025, with trading dipping into the $80,000s — prompting a wave of leveraged liquidations across the market. A multibillion-dollar cascade has obliterated leveraged positions, with BTC responsible for nearly $960 million in forced exits during just one session, as reported by BM data. BTC experienced a significant drop to approximately $81,000 last evening, reflecting a decline of about 10% from its recent peak of over $90,000 within the last 48 hours, as reported, amidst ongoing macroeconomic uncertainty and a delicate market structure.
The sudden turnaround came after the Federal Reserve meeting, during which Powell emphasized the strength of the labor market without indicating any immediate need for policy easing, transforming the occasion into a “sell the news” scenario for speculative assets. Next week, the White House is set to gather banking and crypto executives to address the revival of stalled U.S. crypto legislation. BTC has dropped beneath its two-month-long safety net at the 100-week moving average near $85,000, indicating that sellers have seized control. Traders are currently focusing on $75,000 as the next crucial support level, while a decline toward the 200-week average around $58,000 may lead to additional losses. Broader market turmoil, highlighted by a staggering $357 billion decline in Microsoft’s valuation and rising apprehensions surrounding AI investments, has unsettled investors at large, resulting in the liquidation of $1.6 billion in crypto long positions.
In a notable turn of events over the past 48 hours, gold prices have sharply retraced from their record highs exceeding $5,500, dipping below the $5,000 mark at various points as investors took profits and responded to a strengthening U.S. dollar. Silver experienced a dramatic drop, plunging over 20% at times. The fluctuations in both metals underscore a wider market correction following unprecedented gains, with significant pullbacks challenging the durability of the rally seen earlier in the year.