Over the past week, Bitcoin (BTC) finally broke out of a longstanding consolidation phase, moving decisively above the $90,000 mark. During this time, the leading cryptocurrency traded as high as $94,700 before a sudden rejection that has since forced prices to move within the $90,000-$92,000 range. Amid this mini-consolidation, a market analyst with the username OnChain has identified clear signs of a structural market weakness supporting the possibility of a bear market.
Bitcoin On-Chain, Technical Indicators Combine To Paint Bear Picture
The application of these indicators to the Bitcoin weekly chart highlights areas of similar price structure in the present market and in 2021/2022. Notably, in Areas 1, as seen in the chart below, it is observed that Bitcoin for the first time simultaneously trades below the average price since the last all-time high (anchored VWAP), the SMA50, and also the realized price of coins held for 6–12 months. In the previous cycle, when BTC first fell below all these levels together, it marked the start of a broader weakening phase, rather than a brief correction. In Areas 2, OnChain reports that in both cycles, Bitcoin finds support at the anchored VWAP to its last halving for the second time in each cycle. Following the price correction halt, BTC attempted a mini-rebound in 2022 but faced strong resistance at all indicators from Areas 1, before slipping into a multi-month downtrend.
BTC Market OverviewAt the time of writing, Bitcoin trades at $90,500 following a minor price decline of 0.58% in the last 24 hours. Meanwhile, its monthly loss stands at 1.9%, indicating the bulls continue to struggle for market control. While there are alarming signs of growing market weakness, there are also potential positive developments. One of which is the Clarity Act, as highlighted by OnChain, the potential impact of which, following enactment, largely remains unknown.
