Bitcoin Bear Market Signals: Rising Loss-Making Supply Identified

CryptoQuant analyst Woominkyu indicates that Bitcoin’s supply in losses is increasing, suggesting a potential shift to a bear market, as reported on January 28.

Market dynamics resemble early bear trends seen in previous cycles, impacting confidence and prompting cautious market behavior among investors.

Bitcoin Supply Losses Signal Bear Market Shift

Bitcoin’s loss-making supply (SALL) has begun increasing, according to CryptoQuant analysis. Analyst Woominkyu highlights the potential shift to a bear market structure, noting historical instances when similar patterns led to downturns in 2014, 2018, and 2022.

Bitcoin’s current market indicators suggest a deviation from a mere bull market pullback toward a potentially sustained decline. Despite this, the market levels have not yet reached full capitulation, a key phase often marking market bottoms. Reactions from the crypto community are mixed, with notable absence of major statements from prominent industry figures. Sentiment reflects increased caution among investors, inferred from the community’s apprehension.

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“With the SALL rising, we are historically seeing this spread from short-term to long-term holders before market bottoms.”

CryptoQuant Research

Current Trends Compared to Historical Bitcoin Cycles

Did you know? In past cycles like 2018, Bitcoin’s supply in losses (SALL) consistently rose before defining market bottoms, spreading from short-term to long-term holders until full loss capitulation was achieved.

CoinMarketCap reports Bitcoin (BTC) price at $89,789.77, having experienced a 2.13% surge in 24-hour trading. Market cap stands at $1.79 trillion while BTC remains dominant at 59.03% of the market, reflecting a 12.93% change in trading volume over the same timeframe.

Research insights suggest the current trends in Bitcoin may lead to broader financial impact, potentially echoing historical market downturns. Though regulatory developments remain absent, analysts underscore the importance of on-chain metrics in forecasting future market behavior, with a market waiting for decisive shifts in sentiment.