Bitcoin Price Prediction: AI Bubble Triggers Tech Stock Crash, BTC May Fall Below 100,000

Bitcoin's month-end dumping intensified, reaching a low of $106,800 on October 31. This trend reflects the weakness in the US stock market, as despite large tech companies exceeding expectations in their Q3 earnings reports, the S&P 500 index and the Nasdaq index still saw slight declines. Hyblock's liquidity heatmap data shows that the most immediate liquidity for Bitcoin's price prediction in the short term is at $103,800.

AI capital expenditures surge raises concerns about technology stock bubble

(Source: Trading View)

Investors are concerned that large tech companies are increasing capital expenditures for their artificial intelligence infrastructure, reflecting speculative behavior in the market. Meta has raised its capital expenditures in the field of artificial intelligence to between 70 billion and 72 billion dollars, while Alphabet forecasts that its capital expenditures for AI construction will reach as much as 93 billion dollars. These astronomical investment commitments did not boost stock prices after the earnings reports were released; instead, they triggered a dumping wave.

Among the “seven major tech giants,” Meta's stock price plummeted by 10%, becoming the leader in this round of tech stock declines. Despite Microsoft's outstanding financial report, its stock price still fell by 3%. This market reaction reveals investors' deep concerns about the return cycle of the AI industry. When companies invest billions of dollars into unproven profit models, the market begins to question when these investments can be converted into actual returns.

These concerns are not unfounded. Looking back at the internet bubble period, a large amount of capital flowed into emerging technology sectors, but ultimately most companies failed to achieve the expected returns. Whether the current AI capital expenditure frenzy will repeat the same mistakes is the biggest question in the market. For Bitcoin price predictions, this weakness in tech stocks has a ripple effect, as the correlation between the cryptocurrency market and tech stocks has significantly increased in recent years.

The deeper issue is whether these capital expenditures can truly lead to technological breakthroughs and market demand. Meta's $70 billion investment is mainly used for data centers and GPU procurement, but the user retention rate and monetization ability of its AI products remain in doubt. Although Alphabet's $93 billion commitment is staggering in scale, Google's competitive advantage in the AI field is being eroded by OpenAI and other startups. This mismatch between spending and returns is shaking investor confidence.

Trump's talks lose effectiveness, risks of the China-U.S. trade war unresolved

The market seems to be unimpressed by U.S. President Trump's optimistic description of his meeting with Chinese President Xi Jinping. Apart from reducing fentanyl-related tariffs and China's agreement to delay the rare earth export ban for a year, few details about the talks and the final agreement have been disclosed. The U.S.-China trade war remains a significant risk for investors, and this uncertainty directly weighs down the performance of risk assets.

The performance of Bitcoin's price has been mediocre, which is undoubtedly an unexpected result for investors predicting that if Trump reaches a trade agreement with China, the Federal Reserve lowers interest rates by 25 basis points, and the quantitative tightening policy ends, all news will be confirmed before the end of October, leading Bitcoin's price to rise to the upper range. Despite all the bullish outcomes predicted by traders being confirmed, Bitcoin still fell to a new low.

The phenomenon of “good news being fully priced in” is not uncommon in financial markets. When all positive factors have been priced in by the market in advance, the actual news release often becomes an opportunity for profit-taking. Bitcoin surged earlier this year due to expectations of Trump returning to the White House and crypto-friendly policies, but as these expectations gradually materialized, the price began to correct.

From a macro perspective, the improvement in US-China trade relations is limited to marginal issues. The core problems of tariff structures, the trend of technological decoupling, and the tensions in the Taiwan Strait have not been alleviated by this meeting. For global risk assets, this superficial reconciliation but substantial opposition increases uncertainty. Investors cannot determine whether this temporary easing can be sustained, so they choose to reduce their positions to avoid risk.

Liquidation data reveals the $100,000 defense line is precarious

(Source: Hyblock)

Currently, the path of least resistance for Bitcoin still appears to be downward. The liquidation heatmap data from Hyblock shows that the most direct liquidity for Bitcoin price predictions in the short term appears at $103,800. A one-month look-back period (including longer-held positions) shows bullish liquidity levels at $100,500 and $98,600.

The liquidation heatmap is an important indicator in the derivatives market, showing the accumulated forced liquidation orders at different price levels. When the price reaches these levels, it triggers a chain liquidation, causing the price to accelerate in that direction. The liquidity concentration at $103,800 means that once Bitcoin falls below the current level, a large number of long positions will be forced to liquidate, further pushing the price down.

Three Major Price Barriers Revealed by Settlement Data:

$103,800: The most direct liquidity pool in the short term, breaking through will trigger the first wave of chain liquidation.

100,500 USD: A dual defense of psychological barrier and technical support; a fall below will confirm the bear market structure.

98,600 USD: The largest bullish liquidity concentration zone with a one-month lookback period. Falling to this level indicates a deep correction.

The Bitcoin chart shows that the most likely short-term outcome is a price fall to $103,800, ultimately breaking below $100,000. Technically, Bitcoin's rebound strength in the $107,000 to $108,000 range is clearly insufficient, and the shrinking trading volume indicates weak buying interest. The RSI has fallen below the neutral level of 50, and the MACD continues to maintain a bearish crossover, all supporting the case for further declines.

What is even more concerning is that the cryptocurrency market has liquidated 1.1 billion dollars within 24 hours, and related reports indicate that Bitcoin may fall by 20% to 30%. If this prediction comes true, the price of Bitcoin could drop to the range of 75,000 to 86,000 dollars. Although this is a relatively extreme scenario, it is not entirely impossible given the backdrop of continued weakness in tech stocks and increasing macro uncertainty.

The Dangerous Link Between Tech Stocks and Bitcoin

The correlation between Bitcoin and technology stocks has significantly increased over the past few years, and this linkage has become a disadvantage for Bitcoin in the current market environment. When tech giants like Meta and Microsoft experience declines due to concerns over AI capital expenditures, cryptocurrencies, as high-risk assets, also find it difficult to stand alone. This linkage effect is particularly evident after the proportion of institutional investors has risen.

Institutional investors typically use risk parity models for asset allocation. When the volatility of tech stocks rises, they will simultaneously reduce their allocation to other high-volatility assets, including cryptocurrencies. The launch of Bitcoin ETFs has provided a convenient channel for institutional funds to enter, but it has also made Bitcoin prices more susceptible to the emotions of traditional financial markets.

From the perspective of capital flow, when technology stocks face a dumping, the outflow of funds has not moved into the cryptocurrency market seeking hedging, but rather flowed into traditional safe-haven assets like bonds and gold. This indicates that under the current market structure, Bitcoin has not yet been regarded as a true hedging tool by mainstream investors, but is treated more as a risk asset.

For Bitcoin price prediction, as long as the concerns over the AI bubble in tech stocks remain, Bitcoin will struggle to shake off downward pressure. In the short term, investors should closely watch the support level at $103,800; if it is effectively broken, testing the psychological barrier of $100,000 will be inevitable. If the tech stock selling pressure intensifies, the deep support at $98,600 may become the next target.