Bitcoin is trading below the $90K level, with bulls actively defending key demand to initiate a recovery phase. However, fear and uncertainty continue to dominate market sentiment, as many investors speculate that Bitcoin may have already reached its cycle top. The recent correction has intensified concerns about a potential bearish phase, leaving traders on edge.
Despite the growing pessimism, on-chain data suggests that Bitcoin could be nearing a rebound. CryptoQuant data reveals that the Bitcoin on-chain trader realized loss margin is currently at -14%, a level that has historically preceded a market recovery.
While BTC remains under pressure, this type of widespread selling activity has previously marked local bottoms before a rebound. If Bitcoin manages to hold above key support levels and regain momentum, a strong recovery phase could follow.
However, if bulls fail to regain control soon, further downside movement remains a possibility. The next few days will be critical in determining whether Bitcoin can shake off the bearish sentiment or continue its downward trajectory.
Will Bitcoin Follow This Historical Trend?
Bitcoin is navigating a volatile and uncertain economic environment, with global trade wars and new technological advancements adding to market instability. The recent price drop has heightened concerns, pushing investors into a risk-off sentiment.
Negative news and uncertainty continue to weigh on BTC, making the $90K level a crucial barrier that must be reclaimed to sustain the long-term bullish trend. If Bitcoin fails to break above this level soon, the uptrend could be at risk, leading to further downside.
Despite these challenges, on-chain data suggests that a potential recovery could be on the horizon. CryptoQuant insights shared by analyst Ali Martinez on X reveal that Bitcoin historically rebounds when the on-chain trader realized loss margin reaches -12%.
Currently, this metric stands at -14%, indicating that BTC could be approaching a reversal point. This level suggests that traders have been selling at a loss, often signaling capitulation before a rebound.
As the market experiences serious pressure, bulls are actively defending key demand levels that could set BTC up for a fast recovery. If Bitcoin holds above critical support and investor confidence returns, a sharp move to the upside could follow. The coming days will be crucial in determining whether BTC can regain strength or if bearish sentiment will continue to dominate price action.
Price Holding Above $85K: Can BTC Rebound?
Bitcoin is trading at $85,900 after experiencing massive selling pressure that drove the price down to $78,100 earlier this week. Bulls lost control during this sharp decline, but BTC has since rebounded, now holding above both the 200-day moving average (MA) at $82K and the 200-day exponential moving average (EMA) at $85.5K. These technical levels are crucial for determining the next phase of price action.
If BTC remains above the $85K level, it could signal a stabilization phase, setting the stage for a strong push above $90K in the coming days. However, market uncertainty remains high, with investors closely watching whether this rebound can sustain momentum. A break above $90K would be a strong confirmation of bullish strength, potentially leading to a recovery rally.
On the other hand, if BTC loses the $85K support, selling pressure could increase once again, dragging the price back toward lower demand levels. A deeper correction below $82K would put BTC at risk of retesting previous lows around $78K, which could further fuel bearish sentiment. The next few trading sessions will be critical in determining whether BTC can regain upward momentum or if further downside is ahead.
Featured image from Dall-E, chart from TradingView