Bitcoin BCMI Drops Toward Bear Market Territory: How Close Is BTC To A Real Buy Zone?

Bitcoin is as soon as once more going through notable promoting stress. The market confronts a difficult part marked by weakening momentum and cautious investor positioning. Recent value motion means that bullish conviction has softened. Traders are more and more attentive to liquidity situations, macro uncertainty, and shifting market sentiment. While volatility shouldn’t be uncommon at this stage of the cycle, the present setting displays a market trying to find route slightly than sustaining a transparent upward development.

A latest CryptoQuant report gives extra context by Bitcoin’s Combined Market Index (BCMI), a composite metric that integrates valuation, profitability, spending habits, and sentiment indicators. According to the evaluation, BCMI has fallen into the low 0.2 vary, a degree traditionally related extra with early bear market phases — similar to these seen in 2018 and 2022 — slightly than routine mid-cycle corrections. This shift suggests a deeper structural adjustment could also be underway.

Notably, BCMI was hovering close to 0.5 as lately as October, a zone sometimes interpreted as market equilibrium between bullish and bearish forces. The subsequent decline signifies that this stability has damaged down. Whether this indicators the beginning of a protracted bearish phase or a brief reset will probably rely on future liquidity situations, investor demand, and broader macroeconomic developments.

BCMI Breakdown Points To Structural Weakness In Bitcoin Market

The CryptoQuant report highlights a notable deterioration in Bitcoin’s Combined Market Index (BCMI), suggesting a shift away from mid-cycle consolidation towards a extra defensive market regime. According to the evaluation, the mid-cycle equilibrium across the 0.5 degree failed to carry, with no significant rebound rising from the 0.3 zone.

Instead, the index continued declining instantly towards the low 0.2 vary with out the kind of growth reset sometimes seen throughout more healthy corrective phases. This sample differs from previous mid-cycle cooling intervals and more and more resembles a transition right into a risk-off market setting.

Historical comparisons present extra perspective. Previous cycle bottoms typically fashioned when BCMI reached roughly 0.10–0.15, notably throughout 2019 and once more within the 2022–2023 bear part. Current readings stay above these capitulation ranges, implying that whereas Bitcoin could already be working inside a bearish structural framework, full capitulation situations haven’t but materialized.

Because BCMI aggregates valuation metrics similar to MVRV, profitability indicators like NUPL, spending habits through SOPR, and broader sentiment measures, its decline into the low 0.2 vary displays shrinking unrealized income, rising realized losses, deteriorating sentiment, and ongoing valuation compression. Unless the index stabilizes and reclaims the 0.4–0.5 zone, the chance of continued structural weak point stays elevated.

Bitcoin Tests Long-Term Support After Weekly Breakdown

Bitcoin’s weekly chart displays growing structural stress following the latest lack of the $70,000 degree, a key psychological and technical threshold that had beforehand acted as help. Price has now retreated towards the mid-$60,000 vary, inserting BTC under shorter-term development averages and signaling weakening bullish momentum. This shift suggests the market is transitioning from consolidation towards a extra defensive part.

The chart reveals a transparent sequence of decrease highs for the reason that late-cycle peak close to the $120,000 area. A sample usually related to corrective or transitional market environments. Recent declines have been accompanied by elevated buying and selling quantity. Typically indicative of distribution or pressured deleveraging slightly than gradual profit-taking. Such dynamics usually enhance volatility whereas complicating sustained restoration makes an attempt.

From a structural perspective, the $60,000–$62,000 zone emerges as a vital help space. This area aligns with prior consolidation phases and high-liquidity buying and selling zones that traditionally attracted demand. Holding above this degree may permit Bitcoin to stabilize and doubtlessly type a base for sideways consolidation. However, a decisive breakdown would elevate the chance of deeper retracement eventualities.

Bitcoin’s route stays intently tied to liquidity situations, institutional flows, and broader macro sentiment influencing threat belongings.

Featured picture from ChatGPT, chart from TradingView.com