In-Depth Analysis of Bitcoin’s Market Dynamics Amidst Uncertainties
Introduction
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Bitcoin’s Struggle at the $90,000 Threshold
The cryptocurrency landscape is currently characterized by uncertainty and consolidation. Bitcoin, the leading cryptocurrency, is making attempts to breach the $90,000 mark. However, after a period marked by significant volatility, the market is now experiencing a narrowing price action, indicating a stalemate between buyers and sellers. This hesitation has generated a divide among market analysts.
While some experts view the current situation as a phase where Bitcoin is digesting previous gains, others caution that the prevailing patterns could indicate a continuation of the downtrend, potentially heralding a bearish 2026. The inability of Bitcoin to maintain upward momentum above significant resistance levels has added to these apprehensions, especially given the fragile macroeconomic conditions and inconsistent risk appetite across global markets.
Emerging Bear Market Signals
A recent report from CryptoQuant underscores a notable shift in Bitcoin’s on-chain dynamics, adding weight to the cautious market outlook. The report highlights an uptick in Bitcoin’s “Supply in Loss (%)” metric, a trend that historically correlates with the onset of bear markets.
In past market cycles, such as those in 2014, 2018, and 2022, this metric began its upward trend well before the market reached its bottom, with prices continuing to face downward pressure. This increase didn’t signal an immediate reversal; rather, it indicated a gradual spread of unrealized losses throughout the market. Over time, this pressure moved from short-term traders to long-term holders, marking a significant shift in market psychology from temporary corrections to more fundamental downturns.
Supply in Loss Trends Raise Concerns
Currently, the Supply in Loss metric remains below historical capitulation levels. From a quantitative standpoint, this suggests that the market hasn’t yet reached widespread distress. However, the key concern lies in the change of direction rather than the absolute level. The recent uptick hints at a renewed spread of losses, historically aligning with transitions toward more defensive market regimes.
This shift challenges the perception that current market weakness is a mere pause within a broader bullish trend. Instead, it suggests the possibility that Bitcoin might be entering a bear market phase, characterized by prolonged consolidation, repeated tests of lower levels, and delayed recovery.
Bitcoin’s Battle with Key Resistance Levels
Analyzing the daily chart, Bitcoin’s price action reveals a market entrenched in consolidation following a significant structural breakdown. After facing rejection near the $125,000 mark in October, Bitcoin entered a distinct downtrend, with lower highs and lower lows defining its trajectory. The aggressive sell-off in late November pushed prices below the 50-day and 100-day moving averages, signaling a loss of bullish momentum and a shift in market control towards sellers.
Since early December, Bitcoin has found stability between approximately $85,000 and $92,000, forming a sideways range instead of continuing downward immediately. This scenario suggests that while forced selling pressure has subsided, conviction remains limited.
The 50-day moving average continues its downward slope, capping upward attempts, while the 100-day average also trends lower, reinforcing resistance in the $94,000–$96,000 zone. The 200-day moving average remains significantly below the current price near the mid-$70,000s, indicating that the broader market cycle hasn’t fully reset despite the correction.
While selling volume peaked during the November breakdown, it has since declined, indicating reduced participation rather than renewed demand. As long as Bitcoin remains below the declining 50-day and 100-day averages, any rallies are likely corrective. A sustained hold above $92,000 is necessary to improve short-term structure, while a breakdown below $85,000 could reopen downside risks.
Conclusion
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