Bitcoin (BTC) is undergoing one of the most severe corrections of the year after falling more than 30% from its all-time high of $126,200 on October 6th. The move has reignited concerns that a new bear market is forming. This is where technical, on-chain, and organizational flow signals begin to align in that direction.
Alberto Cárdenas, a Venezuelan trader and investor, told CriptoNoticias that the recent decline is “a sign of a turning point in the market.”
With the drop of more than 20%, he said, “we’ll probably see a ceiling or ceiling in October and then we’re going to enter a bear market in Bitcoin. Based on BTC’s four-year cycle, it could extend through the entirety of 2026, or at least into October 2026.”
Cárdenas highlighted recent behavior among the most short-term investors to sell at a loss. This is consistent with the typical behavior that precedes a Bitcoin bear market.
“There has been significant liquidation activity, and there has been a lot of euphoria on the long side, with a lot of liquidations in October and early November,” he noted.
He added that while this market cleansing will reduce excessive leverage, it will also drive many players away from demand. “It’s generating a negative signal,” he pointed out.
Main factors of Bitcoin bear market
Cárdenas believed that to confirm that the Bitcoin bear market is continuing, it is important to look at the behavior of companies with large amounts of money in Bitcoin, including sales volume, sentiment, exchange-traded fund (ETF) flows, and strategies.
In that sense, he warned that there has been an outflow of funds in recent weeks. “This shows that there is little demand for Bitcoin or digital assets at the moment, which is a bearish sign,” he warned.
“For me, this is the beginning of a bear market. We’re probably going to be in one of those, and it’s going to be a trial by fire that lasts until November next year,” he predicted.
Still, Cárdenas pointed out: This modification also creates opportunities.
This correction presents an opportunity to buy with a short-term horizon, as we believe BTC could return to the $100,000 region. But it depends on your profile. For long-term investors, this is a much more attractive level than just a month ago. Long-term investors understand that asset volatility can exceed 50%.
Alberto Cárdenas, trader and investor.
“Bitcoin is entering a delicate phase”
Similar to Cárdenas, analysts at the Arab Chain platform also asserted: Bitcoin enters a complex phase. Characterized by a significant reduction in sell-side liquidity.
“Seller-side aggregate liquidity metrics indicate a decline to approximately 975,000 Bitcoins,” the company said. This shows that Active entities will be able to sell fewer coins.
At the same time, it also highlights that long-term accumulation continues to increase. “The accumulator address demand indicator shows an increase of over 355,000 Bitcoins,” he points out. The above behaves as follows according to the platform: It is usually interpreted as broadly constructive.
However, institutional demand works in the opposite direction. Arab Chain highlights that “ETF demand has significantly decreased to -51,000 Bitcoin” It reflects the weakness of regulated investors.
Reduced urge to buy Bitcoin
The platform added that the net price-to-purchase correlation on Binance, the world’s largest Bitcoin exchange, has weakened to around 0.72. This means that even if the price reached the $80,000 support, the buying momentum has declined.
“This reflects weak real inflows of liquidity. Arab Chain warns that any selling pressure could trigger a rapid price correction, noting that the overall picture is “limited supply and apparent long-term accumulation, offset by weak institutional demand and reduced purchasing momentum.”
Leaving aside the future direction of the market, This is contingent on the purchasing power of key liquidity pools being restored.
The graph below shows how as the price of Bitcoin falls, sell-side liquidity decreases, accumulator demand increases, and ETF demand turns negative. This reflects limited supply and clear weaknesses in institutional liquidity inflows.
“The market is already operating in a bearish environment.”
Meanwhile, a CryptoQuant analyst known as CraZzyBlockk claims that the unrealized P&L data by age group shows “clear changes in market structure.”
He emphasized that new investors, especially those who hold Bitcoin for a day to a month, are facing “a large amount of unrealized losses.” Meanwhile, short-term holders (all less than six months) are facing the deepest decline since the cycle peak. Experts say this puts these groups in “clear negative territory”.
Analysts argue that these situations are They often predict a Bitcoin bear market or the early stages of a cycle break.
“When these groups are lost en masse, the market typically enters a period where price recovery turns into outflow liquidity,” he said. This creates resistance at the level where these groups average their entry costs, as sellers seek to cut their losses.
The graph below shows how different groups of Bitcoin holders are recording unrealized losses as the price declines. The colored bands reflect that short-term investors, especially those holding BTC for 1-30 days, endure the heaviest losses, while long-term holders exhibit more modest fluctuations.
The price line shows how each pullback has increased stress in the recent group, indicating that the market is dominated by selling pressure and bearish sentiment.
Bullish scenario dependent on short holders
CraZzyBlockk reveals there is still a bullish scenario. However, it is “highly dependent” on the behavior of short-term holders (STH).
Therefore, if STH resists surrendering unrealized losses of about 20% to 30%, “the market can avoid the deep reset that comes with a full bear cycle,” he explains.
But if these investors begin to take losses aggressively, “the market tends to prolong the decline until this group disintegrates completely.”
Using current data, analysts conclude that BTC is “operating in an environment similar to the Bitcoin bear market, where underground short-term capital and emotional supply dominate.” The above is in view of the fact that STH has fled the market in fear in recent days, as reported by CriptoNoticias.
Bitcoin is at a critical moment
Clearly, Bitcoin is going through a critical period. The combination of falling prices, weakening institutional demand, the capitulation of short-term investors, and unfavorable technical signals suggests that the asset faces an increased risk of moving into a sustained bear market.
However, long-term accumulation remains active and some analysts remain optimistic and believe this is a correction within a broader cycle.
In either case, market evolution will depend on BTC’s ability to recover key cost levels and stabilize institutional demand. Overcome the prevailing selling pressure in the short term.
