Bitcoin sinks 6% to seven-week low as post-election stock rally dies

Bitcoin cracked below $76,000 on Thursday, shedding more than 6% to $75,463 on Bitstamp — its lowest print since Sept. 16. The drop landed as the post-midterm rally in US equities flipped hard into reverse and traders bailed out of tech. Crypto markets took the hit fast: CoinGlass data showed nearly $500 million in positioning liquidated in the first hour of US trading, with 24-hour total liquidations approaching $850 million.

The stock reversal was brutal. The S&P 500 fell 2.7%, while the Nasdaq Composite lost more than 4% and hit its lowest level since July 29. Jordan Watson, a portfolio manager at Tandem Investment Advisors, told CNBC that investors may face more volatility as they digest election results and potential policy implications, and warned the equity gains that followed the midterms should not be treated as an 'all-clear signal.'

Oil ran the other way, rebounding on reports of fresh strikes on tankers in the Middle East and uncertainty over how Democrats might move to resolve the US-Iran war. WTI crude climbed back above $90 a barrel, while Brent gained 2.5% to approach $97.

For bitcoin, the question is now support. The pair is targeting $76,000 and has drifted toward the bottom of its one-month trading range, threatening to lose its 50-week simple moving average at $75,733. Cointelegraph has previously reported concerns that Democrat policies could be less favorable to the AI sector, potentially curbing already precarious capital expenditure plans.

Economist Mohamed El-Erian pushed back on assuming the worst for tech, writing in a blog post: 'Will the shift in Congress actually slow tech down? If yes (as many assume, though I'm less sure), can the rest of the market and economy thrive without the shield of tech earnings and spending?' He called the day's tech-stock weakness 'not surprising.'

Crypto trader Rekt Capital says bitcoin is re-running May's script, when rangebound action around $80,000 eventually broke down into new macro lows of $57,000 in late June. If that pattern holds, the coming sessions will decide whether the 50-week SMA holds or joins the wreckage.