Bitcoin is currently facing challenges in its price action, with weak technical indicators, fading momentum, and a lack of new catalysts contributing to a mini bear market.
According to a report from 10x Research, Bitcoin is trading below its crucial trend level of $88,000, which is a key indicator for distinguishing between bull and bear market phases.
Mini Bear Market Confirmed by On-Chain Data
The firm highlights that on-chain data supports the view that Bitcoin is entrenched in a mini-bear market. 10x Research noted that Bitcoin’s price struggles to maintain momentum, as the price stalled at $88,500 and has since reversed. Additionally, the cryptocurrency remains below its 21-week moving average, a widely-used indicator for tracking long-term trends. This bearish pressure is further exacerbated by the short-term holder realized price, which has acted as a strong resistance point around $93,000, signaling that traders are exiting breakeven positions.
Retail Investor Activity Declines
Another factor contributing to the negative sentiment is the reduced activity from retail investors, especially after significant losses in meme tokens. Funding rates also remain low, indicating a lack of risk appetite in the market. With ETF outflows continuing for a second consecutive month and hedge funds pulling back from BTC-related trades, confidence in the market has taken a hit. Without a significant rise in funding rates, it’s unlikely that Bitcoin ETFs will see strong inflows again, according to the report.
Uncertain Macro Environment and Political Factors
The broader macroeconomic environment isn’t offering much support either. While some hope that the Federal Reserve may cut rates by June, 10x Research suggests this might be delayed until September due to persistent inflation and strong labor market data. Bitcoin’s price action depends on real economic action rather than speculation, as the market is cautious about potential policy changes.
In terms of political developments, despite President Trump’s strategic Bitcoin reserve announcement, these efforts lack the necessary legislative backing to significantly affect market sentiment. The report emphasizes that holding confiscated Bitcoins won’t create new buying pressure, and much of the recent optimism around crypto has been driven more by narrative than fundamental factors.
Near-Term Outlook and Volatility
Looking ahead, 10x Research expects Bitcoin to trade within a range of $73,000 to $94,000 in the near term, with volatility likely to remain a key feature. The analysts recommend using selling options strategies to take advantage of price movements within this range. However, unless a major macroeconomic shift or a bullish catalyst emerges, the overall market outlook remains muted. The analysts concluded by stating that Bitcoin is currently in a fragile market structure, confirming the mini bear market sentiment.
Kosta Gushterov
Reporter at Coindoo
Kosta has been a part of the team since 2021 and has solidified his position with a thirst for knowledge, incredible dedication to his work and a “detective-like” mindset. He not only covers a wide range of trending topics, he also creates reviews, PR articles and educational content. His work has also been referenced by other news outlets.
Source: https://coindoo.com/bitcoin-faces-mini-bear-market-according-to-10x-research/