Last week, Bitcoin (BTC) finally broke out of a years-long downturn and decisively surpassed the $90,000 mark. During this time, the leading cryptocurrency was trading as high as $94,700, but the sudden rejection caused the price to remain in the range of $90,000 to $92,000. Amidst this mini-consolidation, market analysts with the username OnChain identified clear signs of structural market weakness that support the possibility of a bear market.
Bitcoin on-chain and technical indicators combine to paint a bearish picture
In a QuickTake post on CryptoQuant, OnChain explains that Bitcoin is showing early signs of structural weakness on the weekly chart, similar to what happened in 2021-2022. Analysts confirm this theory by looking at a combination of price-based technical indicators and on-chain demand indicators to determine appropriate market conditions. These include the four anchor VWAPs (2021 ATH, 2025 ATH, 3rd halving, and 4th halving), SMA50, realized price – UTXO age range (6-12 months), and Bitcoin’s apparent demand.
Applying these indicators to the Bitcoin weekly chart highlights areas of similar price structure in the current market and in 2021/2022. Specifically, in Area 1, we observe that for the first time Bitcoin is trading simultaneously below its SMA50, the average price since the previous all-time high (fixed VWAP), and the realized price for coins held for 6-12 months, as seen in the chart below. Last cycle, when BTC fell below all of these levels for the first time, it signaled the beginning of a broader weakening phase rather than a temporary correction.
In Area 2, OnChain reports that in both cycles, Bitcoin found support at the VWAP anchored to the second and final halving in each cycle. After the cessation of price correction, BTC attempted a mini-rebound in 2022, but faced strong resistance in all indicators in Area 1 and subsequently fell into a months-long downtrend.
According to market analysts, the indicator highlighted in Area 1 is currently located around $98,000 to $101,000, indicating the next major resistance point. Meanwhile, all reported price movements suggest a lack of visible buying pressure as Bitcoin’s apparent demand continues to plummet. OnChain points out another worrying similarity: similar to 2021-2022, apparent demand is also approaching negative territory.
BTC market overview
At the time of writing, Bitcoin is trading at $90,500 after a slight price decline of 0.58% over the past 24 hours. Meanwhile, the monthly loss remained at 1.9%, indicating that bulls continue to struggle for market control. While there are worrying signs of a growing market downturn, there are also potential positive developments. One is the Clarity Act, which has been highlighted by OnChain, but its potential impact once enacted remains largely unknown.
Featured image from Pixabay, chart from Tradingview
