The Bunny Report #02: The VIX Is Rising and Bitcoin Is Still Bleeding

The Bunny Report is the personal market commentary of our analyst Bunny. It is opinion and analysis, not financial advice. Always do your own research.

Hi, Bunny here. Welcome back to The Bunny Report, my market series where I share my read on Bitcoin, macro, liquidity, Wall Street sentiment, and the key levels I am watching.

In my last note I said I was expecting Bitcoin to push from the 61k area toward 64k. It was not a huge move, but I had conviction in it, and it played out. From the 64k zone I then said I expected Bitcoin to keep grinding lower, and today Bitcoin reached the 59k area. The market followed the path I was watching. I will not pretend I always get it right, but the framework has been working, so let me walk you through what I see now.

The VIX is waking up

One thing has really caught my attention over the last few days: the rise of the VIX. For anyone who does not know it, the VIX is often called the fear index. It measures expected volatility in the market, and in simple terms it tells us how much fear investors are starting to price in. The key idea to remember is this: when the VIX starts rising while markets already look weak, something may be building under the surface. That is exactly what I am watching.

Over the past few days I have seen drops in the major indices that, in my view, look irrational. The S&P 500, the Nasdaq and risk assets were holding firm, and then suddenly we got weakness with no major macro data and no breaking headline that fully explains it. No shock, no clear catalyst, just selling. When markets fall without an obvious reason, I pay attention, because the reason often shows up later.

Is a black day coming?

I think something could be building again. Call it a Black Friday, a Black Monday, or any day of the week with the word black after it. The name does not matter, the reaction does. It will be easy to spot if it happens: you will open X, turn on the TV, and everyone will be saying the same thing, that the Nasdaq fell hard, tech collapsed, and risk assets got destroyed. Maybe Nvidia drops sharply, maybe the S&P breaks key levels, maybe a hyped Wall Street name loses 20 percent in a session. The specific stock does not matter. The point is that if traditional markets finally panic, Bitcoin will probably not stay calm, and it could accelerate its fall. I still think the 48k area is on the table.

The Bitcoin levels I am watching

My short-term levels right now are 58k and 56k. These are the zones where we could see a bounce or a relief rally, not because the structure is strong, it is not, but because markets rarely fall in a straight line forever. Even a weak market bounces. The problem is that a bounce is not strength. A bounce stays a bounce until Bitcoin starts printing higher highs, reclaiming important levels, and showing real demand. Right now I do not see that. I see a market that keeps bleeding slowly, and slow bleeding can be worse than a fast dump because it grinds down confidence day after day.

Why I still expect capitulation

I have been in Bitcoin since 2013 and 2014, and I have seen this market many times. When Bitcoin falls in this irrational, exhausting, slow way, it usually does not end with a calm, peaceful bottom. It tends to end with capitulation: a massive red candle, a violent move lower, a day where the last longs get wiped and everyone who kept calling the bottom finally gives up. That is often where a new cycle can begin. I cannot guarantee the exact level. Maybe capitulation is around 48k, maybe a little higher, maybe lower. It is too early to know with precision. But I still believe Bitcoin needs a final liquidation event before the market can truly reset.

Wall Street is getting nervous, and keep an eye on quantum

Another theme I think people should watch is quantum computing. Wall Street may not fully understand Bitcoin, mining, private keys or decentralization, but they understand one thing: if there is a potential technological risk to Bitcoin's security narrative, big capital pays attention. Quantum computing is starting to enter that conversation again. I am not saying Bitcoin dies to quantum, or that anything breaks tomorrow. But markets do not need certainty to sell, they only need fear. If big investors start seeing headlines about quantum computing, cryptography and Bitcoin security, some may decide they do not want to hold risk while the story develops. In the coming weeks I expect you will hear a lot more about it, and while that narrative grows, Bitcoin could keep grinding toward the levels I mentioned.

My view for now

For now I remain bearish on Bitcoin. My key levels stay 58k, 56k and 48k. The first two could give a short-term bounce; the 48k area becomes much more important if the market enters a real capitulation phase. Until Bitcoin proves otherwise, I do not see strength. I see a tired market, a VIX that is waking up, a more nervous Wall Street, and Bitcoin slowly drifting toward the zones where real buyers may finally appear.

If you want to gauge the same fear I am describing, the crypto Fear and Greed reading and on-chain liquidity are worth tracking alongside the levels above. As always, I will keep watching and updating you through The Bunny Report. The market does not need to go up every day. What matters is having a read on what it is likely to do before everyone else catches on. Bunny out. This article is the author's personal opinion and is not financial advice.