Will Bitcoin Crash to $74K as Japan Eyes Rate Hike on December 19?

Bitcoin price continues to weaken after breaking below its recent consolidation range, now trading within a descending channel on lower timeframes. 

The broader crypto market dropped 1.51% in 24 hours, deepening the week’s losses to 7%. 

Any fall below the current support could cause a drop to $74,000. This fall follows in anticipation of the decision by Japan in December 19 to increase its rates, and hence this may affect the global liquidity. Key altcoins such as ETH, SOL, and XRP experienced considerable losses as well.

Bitcoin is at risk of falling by a significant margin to $74,000 ahead of a critical rate ruling by the Bank of Japan (BoJ) on December 19. Although the U.S. politics and regulation keep distracting global markets, the monetary shift in Japan can become the catalyst of a significant liquidity shock.

Japan’s Rate Hikes Dry Up Global Liquidity

Japan is a key player in global finance, holding over $1.1 trillion in U.S. Treasury bonds. Raising interest rates, the global liquidity of dollars shrinks. Risky assets such as Bitcoin tend to suffer down the line.

The trend in history is evident. In March last year, a rate increase by BoJ was followed by a 23 percent drop in Bitcoin. A further 26% decline followed the increase in July 2024. In January 2025, there was another increase, which led to a decline of Bitcoin by 31%. The unwinding of the Yen carry trade each time triggered mass crypto sales.

This plan will entail borrowing of the yen at low rates and investing in high-yield investments such as Bitcoin. Traders have to sell their holdings fast to meet the increasing costs when the rates increase. This generates dynamic market declines.

At the moment, Bitcoin is already slightly in the decline. The market leverage is still high, and on-chain metrics indicate low retail sentiment. Such indicators are indicative of increased susceptibility.

The meeting on December 19 is not just another policy meeting but it is a possible turning point. Markets may respond quickly in case BoJ increases further. Analysts call upon traders to control their risk, cut back on leveraging, and pay close attention to the decision of the Tokyo. 

Coinbase Bitcoin Premium Hits 1-Month Low: Sell-Off Alert

The Coinbase premium decreased to its lowest level in a month, which means that there is less institutional demand, and the price of the Bitcoin dropped. Institutions also seem to be shedding jobs, with the negative premium indicating lesser US-based buying than offshore platforms.

There is steady selling under the present construction, and downside momentum has been on the rise. Such a trend is in line with recent volatility and correction in the market.

Bitcoin Price Breakdown Looms: $74,000 Becomes Key Level to Watch

The Latest BTC price hovered at $87,000, testing support as momentum indicators signal caution. 

The observed 4-hour candle has shown that Bitcoin traded within a narrow range of between $86,600 and 87,100, which means low volatility and then a possible move.

The RSI is at the moment having a figure of 44, which is lower than the neutral figure of 50, implying weak bullishness. 

In the meantime, the MACD histogram has a slightly positive value but is still less than the line of signal, which means a weak positive movement. 

The MACD lines have been flattened, and this further proves that there is indecision in the current phase.

If the Future Bitcoin outlook reclaims $88,000, the next levels to watch are $91,000 and $94,000. A breakout above $96,000 would signal trend continuation.

If $87,000 breaks down, support lies at $84,000, then $80,000. Further correction might cause BTC to reach the level of $74,000 following the Rate hike in Japan on December 19.