Bitcoin Entering Phase 2 Bear Market, Analyst Warns
Veteran on-chain analyst Willy Woo has warned that the Bitcoin (BTC) market is strengthening its bear pattern and approaching the second part of a multi-stage downturn.
The forecast challenges persistent bullish narratives, suggesting the worst could also be forward for the world’s largest cryptocurrency.
Phase 1 Nears Its End as Volatility Spells Trouble
In a collection of posts on X on February 18, Woo outlined a three-phase bear market framework, positioning Bitcoin at an important juncture. According to him, the primary stage of the present bear market began within the third quarter of 2025 when liquidity first broke down, and the value began to observe.
He defined that the important thing sign comes from volatility metrics utilized by quantitative analysts, with Bitcoin coming into a chronic decline when volatility spiked upward. That volatility continues to be climbing, indicating the bear pattern is gaining floor.
“In this part, perma bulls will blindly say it’s a correction inside a broader bull market however is not going to offer you any arduous proof of capital flowing in,” Woo wrote.
The analyst added that his inside liquidity fashions, launched weekly to buyers, presently match the volatility indicators. In his opinion, the second a part of the bear market will kick in when world equities start to weaken.
He argued that the most important cryptocurrency typically reacts sooner than equities when capital exits markets due to its smaller measurement and better sensitivity to liquidity shifts.
“Under this bear market framework, BTC is presently in Phase 1 and near Phase 2,” acknowledged Woo.
He characterised the ultimate episode as “the sunshine on the finish of the tunnel,” predicting a turnaround in liquidity, with capital outflows hitting a high level earlier than stabilizing. However, he warned that there may very well be yet one more value capitulation simply earlier than or instantly after the height outflows.
Cycle Indicators Show Mixed Signals for Long-Term Outlook
Not all analysts are deciphering the information as outright bearish. In a latest publish, Axel Adler Jr. wrote that Bitcoin’s Entity-Adjusted Liveliness metric peaked in December 2025 and has began declining, a sample seen in previous accumulation durations lasting between 1.1 and 2.5 years. The indicator tracks BTC motion relative to holding time and tends to fall after distribution durations finish.
Another perspective from GugaOnChain targeted on valuation. Using the MVRV Z-Score developed by Murad Mahmudov and David Puell, the analyst said the present studying close to 0.48 locations Bitcoin near historic accumulation zones somewhat than overheated territory. That suggests some buyers might even see present costs as discounted in contrast with common acquisition prices.
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