Bitcoin Bear Market Confirmation and Key Support Levels
Bitcoin’s entry into a bear market marks a big structural shift in cryptocurrency dynamics, as shown by multiple on-chain and technical indicators. Anyway, Bitcoin has traded 20% below its all-time high of $126,000, setting new lows and signaling a move from short-term correction to sustained downtrend. This phase features reduced bullish leverage and increased selling pressure, with key support levels becoming vital for market stability. Swissblock highlighted the destabilization of Bitcoin’s risk-off signal, noting that while it stays in a low-risk regime, a switch to high-risk would confirm the bear market. This is backed by Glassnode data showing a 62% drop in monthly funding for Bitcoin perpetuals, from $338 million to $127 million, indicating less speculative interest. Analyst Mikybull Crypto supported this, citing the breakout of USDT market dominance from an inverse head-and-shoulders pattern as a historical sign of bear markets.
- Critical support levels include the psychological $100,000 mark
- The 75th percentile cost basis around $99,000 has historically held during pullbacks
- Breakdown below short-term holders’ cost basis of about $113,000 suggests capitulation among recent buyers
Trader Daan Crypto Trades stressed the $98,000 level, saying a break below could spark liquidations down to $95,000. On that note, some analysts see this as a healthy reset rather than a long bear market. But the consensus from on-chain data points to a macro downtrend, with lower long exposure and rising stablecoin preference showing risk aversion. This difference highlights the complexity of market forecasting, where technical and sentiment factors must be weighed.
If the indicator enters and stays in a high-risk, it would suggest that Bitcoin is transitioning into a bear market, marking a structural change rather than a short-term correction.
Swissblock
Bear market confirmed.
Mikybull Crypto
On-Chain Metrics and Market Sentiment Analysis
On-chain metrics give deep insights into Bitcoin’s market health, revealing changes in investor behavior and sentiment that often come before price moves. These indicators, like funding rates, cost basis models, and supply dynamics, offer solid data to judge trend sustainability beyond just price action. You know, current data shows a notable cooling in bullish momentum and more caution among participants. Glassnode’s analysis of Bitcoin perpetuals reveals a sharp fall in monthly funding paid by longs, dropping from $338 million to $127 million, which signals weaker speculative interest. This decline in bullish leverage often precedes price tops and hints at a broader bearish shift. Also, losing support at the 85th percentile cost basis around $109,000 and focusing on the 75th percentile at $99,000 points to weaker investor confidence and possible further drops.
- The Advanced Sentiment Index plunged from 86% to 15% over two weeks
- The Crypto Fear & Greed Index fell below 30/100, showing heightened fear not seen since mid-April
- Data from Santiment and Binance‘s True Retail Longs and Shorts Account indicate underlying demand during dips, contrasting with overall pessimism
Historical examples, like the Fear & Greed Index collapse in February 2025, led to eventual recoveries, suggesting that extreme fear often marks turning points. But sustained recovery needs sentiment to rise above 40-45% with a trending 30-day moving average, as Axel Adler Jr. emphasized. Putting it all together, the current setting has traits of market bottoms, with fear extremes and lower leverage opening doors for rebounds. This mix gives a full picture, noting that while short-term swings may continue, these metrics can guide careful decisions.
This underscores a clear macro downtrend in speculative appetite, as traders grow reluctant to pay interest to maintain long exposure.
Glassnode
Zones below 20% often trigger technical bounces, but sustained recovery will require sentiment to climb back above 40–45% with the 30-day moving average trending higher.
Axel Adler Jr.
Technical Support and Resistance Levels
Technical analysis of Bitcoin’s price action centers on key support and resistance levels that shape short-term moves and possible trend changes. These levels come from chart patterns, moving averages, and liquidation clusters, giving practical insights for traders in volatile times. The current scene is defined by a tight battle between bulls and bears around critical price zones. Bitcoin’s fight to stay above $112,000 is clear in cumulative volume delta data from Hyblock, which shows seller control and failed rebounds. Liquidation heatmaps uncover dense order clusters near $107,000, hinting at a potential shift if tested, with more support at $98,000 from June lows. The bunching of liquidations around these levels suggests high volatility risks, where breaks could set off chain reactions driving prices to $95,000.
| Level Type | Price | Significance |
|---|---|---|
| Resistance | $102,500-$105,000 | Barriers to recovery with ask orders |
| Support | $98,000 | Key level from historical lows |
| Breakout | $118,000 | Needed for bullish momentum reaffirmation |
Analysts like Sam Price stress the need for weekly closes above $114,000 to avoid deeper corrections, underlining how psychological barriers affect price dynamics. Differing technical views show splits in interpreting these levels; some see consolidation as good for future gains, while others caution about cycle fatigue. For instance, Material Indicators said the current phase feels more like a short-term exit pump than buildup, reflecting doubt in trend staying power. This subjectivity in analysis calls for a multi-angle approach blending technicals with on-chain data. In the end, holding above $112,000 is key to preventing faster selling pressure.
Bitcoin needs a weekly close above $114,000 to avoid a deeper correction and reaffirm bullish strength.
Sam Price
This is the last major level before the $98K low from the Middle Eastern war fud back in June.
Trader Daan Crypto Trades
Institutional and Retail Investor Behavior
Institutional and retail investors show different behaviors that together shape Bitcoin’s market dynamics, with institutions adding stability and retail bringing liquidity and volatility. Anyway, grasping these patterns is essential for judging market health and predicting price moves, as each group reacts uniquely to market conditions and outside factors. Institutional activity displays toughness, with Q2 2025 data showing a 159,107 BTC rise in holdings and spot Bitcoin ETFs recording positive flows, like $220 million inflows amid gloom. Glassnode reported net inflows of about 5.9k BTC on September 10, the biggest since mid-July, pointing to renewed demand and possible market bottoming. Corporate uptake, shown by KindlyMD’s investments, strengthens Bitcoin’s role as a treasury asset, backing long-term value.
- Retail investors, while key for liquidity, often heighten short-term swings through emotional trades and leverage use
- Metrics from Binance reveal accumulation during dips, but recent long liquidations over $1 billion show how leverage worsens declines
- The dominance of perpetual futures in daily action, with open interest between $46 billion and $53 billion, indicates a balanced but tense market where retail sentiment fuels volatility
Comparing the groups shows institutions concentrate on strategic, scarcity-based investments, whereas retail responds to technical signals and social media. Maartunn highlighted the flushing out of $11.8 billion in leveraged altcoin bets and $3.2 billion in Bitcoin positions, signaling a risk appetite reset. This split creates chances for price discovery but also brings instability in uncertain periods. On that note, the current market gains from balanced involvement, with institutional flows supporting basics and retail ensuring liquidity.
US spot Bitcoin ETFs saw net inflows of ~5.9k BTC on Sept. 10, the largest daily inflow since mid-July. This pushed weekly net flows positive, reflecting renewed ETF demand.
Glassnode
$11.8 billion in leveraged altcoin bets and $3.2 billion in speculative Bitcoin positions have been flushed out, pointing to a significant reset in risk appetite.
Maartunn
Macroeconomic Factors and Federal Reserve Influence
Macroeconomic conditions, especially Federal Reserve policies, play a crucial role in shaping Bitcoin’s value by affecting risk appetite and capital movements. The interaction between interest rates, economic data, and cryptocurrency markets creates a tricky setting where outside factors can cause major price swings and trend shifts. Current weak US economic data, such as labor market softness, has raised hopes for Fed rate cuts, with markets expecting a 0.25% reduction in October 2025. Historical patterns indicate that monetary easing often matches cryptocurrency rallies, as lower rates make non-yielding assets like Bitcoin more appealing. The 52-week link between Bitcoin and the U.S. Dollar Index at -0.25, its lowest in two years, means dollar weakness might further bolster prices.
| Factor | Impact | Historical Evidence |
|---|---|---|
| Fed Rate Cuts | Boosts risk assets | 2020 cuts led to Bitcoin gains |
| Economic Data | Influences investor sentiment | Labor market softness prompts easing |
| Geopolitical Risks | Adds volatility | Arthur Hayes warns of drops to $100,000 |
The Kobeissi Letter stressed that rate cuts near all-time highs have historically lifted the S&P 500 by an average of 14% in 12 months, suggesting possible spillover into crypto markets. This supportive backdrop is tempered by geopolitical risks and inflation worries, as Arthur Hayes noted, warning of potential falls to $100,000. Contrasting views highlight Bitcoin’s changing tie to tech stocks, exposing it to broader market swings, while some view it as a hedge in turmoil. Ash Crypto’s upbeat outlook predicts trillions in capital flows from rate cuts, possibly starting a parabolic phase, matching past cases of dovish policies driving rallies. But the current setting’s intricacies demand close watch on economic indicators. You know, the expected Fed moves and weak data build a broadly supportive environment for Bitcoin, though with built-in volatility.
When the Fed cuts rates within 2% of all time highs, the S&P 500 has risen an average of +14% in 12 months.
The Kobeissi Letter
Macro pressures, including inflation and geopolitical risks, could push Bitcoin down to $100,000.
Arthur Hayes
Futures Market and Leverage Dynamics
Bitcoin’s futures market and leverage dynamics are key for price discovery and stability, with open interest and liquidation patterns showing market mood and possible volatility. Recent changes in these metrics point to a healthy reset of speculative excess, cutting the chance of sharp price moves and setting the stage for steadier action. Data from CoinGlass indicates a $4.1 billion decrease in Bitcoin futures open interest as prices fell from $126,000 to $119,700, reflecting the clearance of overleveraged positions. Glassnode analysts call this a leverage reset, with volatility washing out excess on both long and short sides, though open interest stays high. The flushing out of $11.8 billion in leveraged altcoin bets and $3.2 billion in Bitcoin positions, as Maartunn highlighted, suggests a major recalibration of risk appetite.
- Liquidation heatmaps display clusters of stop-loss orders, with thick areas between $111,000 and $107,000 indicating key support zones
- The concentration around $116,500 and $119,000 shows resistance levels where price moves might speed up due to cascading liquidations
- High open interest settings amplify volatility, but the current drop lowers the odds of such events, aiding market calm
Comparing current metrics with past patterns shows likenesses to earlier resets that came before sustained rises, where leverage normalization allowed for healthier price growth. However, opposing views warn that high open interest still means speculative activity that could fuel ongoing volatility, stressing the need for constant monitoring. It’s arguably true that the leverage reset builds a sounder base for potential price advances by reducing overleveraged dangers.
The market is undergoing a leverage reset, with volatility flushing out excess positioning on both sides.
Glassnode
$11.8 billion in leveraged altcoin bets and $3.2 billion in speculative Bitcoin positions have been flushed out, pointing to a significant reset in risk appetite.
Maartunn
Expert Predictions and Integrated Market Outlook
Expert forecasts for Bitcoin’s future cover a wide spectrum, from very bullish targets to careful warnings, based on technical, fundamental, and sentiment analyses. These predictions assist market players in handling uncertainties by offering varied takes on potential results, though they mirror the inherent guesswork in cryptocurrency markets. Bullish stances include Timothy Peterson’s call for $200,000 within 170 days, supported by probability modeling and historical seasonality, with 60% of Bitcoin’s yearly performance happening after October 3. Technical analyst Jelle points to the weekly stochastic RSI’s ninth bullish signal, which in the past led to 35% gains, possibly pushing Bitcoin to $155,000. These optimistic views are strengthened by institutional backing and macroeconomic elements like anticipated Fed rate cuts.
- Bearish outlooks spotlight risks, such as CryptoQuant’s report that 8 out of 10 bull market indicators have turned bearish, with cooling momentum
- Glassnode analysts caution about the bull market entering a late-cycle stage, and Mike Novogratz warns that extreme targets might only happen in poor economic conditions
- Material Indicators describe the current phase as a short-term exit pump rather than accumulation, emphasizing uncertainty
Side-by-side analysis reveals that bullish cases focus on Bitcoin’s structural benefits, like fixed supply and growing adoption, while bearish views highlight technical resistance and cycle burnout. This balance underscores the multi-factor nature of valuation, where no single method gives sure answers. Historical trends, such as October’s steady gains since 2019, add background but need blending with current data. On that note, the overall view leans cautiously optimistic, with underlying strengths hinting at upside potential despite near-term risks. The present doubt could give way to renewed upside as seasonal patterns and institutional flows aid recovery.
60% of Bitcoin’s annual performance occurs after Oct. 3, with a high probability of gains extending into June.
Timothy Peterson
While I feel like the macro is solidly bullish and the top isn’t in yet, this currently feels more like a short term exit pump, than accumulation. Time will tell.
Material Indicators
