AI selloff could push Bitcoin toward $65K before capital returns to crypto, Hilbert CIO says

Bitcoin could fall toward $65,000 if losses across artificial intelligence and semiconductor stocks trigger broader portfolio liquidations, according to Russell Thompson, chief investment officer at Hilbert Group.

In the firm’s November 9 market report, Thompson warned that funding concerns surrounding smaller AI and chip companies could place additional pressure on hedge funds following last week’s technology stock selloff, which saw the Nasdaq fall 6% on Thursday.

“If you start getting margin calls, then you start selling bits of your portfolio that are not particularly core, and that usually means Bitcoin,” Thompson said.

With Bitcoin trading around $74,200 at the time of his assessment, Thompson identified initial support at $72,800, followed by moving average support near $72,700 and a major trend line at $71,900.

He warned that a break below $71,900 could put $65,000 in focus, with limited technical support around the psychological $70,000 level.

Hilbert’s proprietary liquidity indicators have also weakened, with its five factor model falling to 2.61 and its six factor model reaching 3.02. Thompson estimated that Bitcoin exchange traded funds recorded roughly $1.2 billion in outflows last week, while options markets continued to show stronger demand for downside protection.

Despite the bearish outlook, Thompson expects the retreat from AI and technology stocks to eventually support a recovery in crypto markets.

He argued that Bitcoin’s previous peak coincided with capital moving out of crypto and into AI, semiconductor and technology stocks. As investors unwind those positions, some of that money could return to digital assets once the current period of deleveraging subsides.

Thompson said a Bitcoin breakout before the end of the year remains possible, although immediate market conditions remain unfavorable.

The outlook comes ahead of Tuesday’s US consumer price index report. Thompson cited market pricing that assigns a 77% probability to a Federal Reserve rate hike in December following stronger employment and wage data.