Technical structure suggests continued pressure on key support levels, while sentiment in the crypto market remains at extremely low levels. History shows that such moments often precede the final phase of a bear cycle.
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Technical Picture Remains Fragile
Bitcoin broke downward after a brief consolidation within a bear flag, confirming weakness in the short-term trend. The move was accompanied by slightly elevated volumes, which technically increases the probability of continued decline toward the area around 60,000 USD. The market is thus currently heading toward a retest of the previous low of this cycle.
A retest is crucial information from a price action perspective. Should the support fail to hold, selling pressure could intensify further. On the other hand, it is necessary to view current price movements in a broader context – short-term volatility alone does not necessarily signal a definitive shift in the long-term outlook.
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Extreme Fear and Cycle Logic
The Crypto Fear and Greed Index has once again plunged to a value of 5 points, representing a zone of extreme fear. Since 2018, the indicator has appeared at similar levels only a few times, underscoring the intensity of the current bearish sentiment. Moreover, the market has remained below the 20-point threshold for an extended period, signaling persistent pressure on investor psychology.
Historically, each Bitcoin bear cycle has shared a common final phase – a sharp washout, or “shakeout.” In this stage, partial capitulation by investors who entered without a clear strategy often occurs. Paradoxically, the moment when resignation and indifference prevail is often a harbinger of stabilization and subsequent reversal.
The question remains: where might a price bottom form? Psychologically significant is the area around 50,000 USD, though a deeper decline toward 35,000 USD cannot be ruled out either. Every cycle is different and the macroeconomic environment continues to evolve, making it essential to work with multiple scenarios and maintain a disciplined approach to risk management, especially in an environment like the current CoinMarketCap market.
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