Bitcoin Slips Deeper Into Bear Territory, Cryptoquant Analysis Shows

Bitcoin has dropped further into bear territory, breaking below its 365-day moving average for the first time since March 2022. Cryptoquant noted that the current downturn appears worse than the early phase of the 2022 bear market. The price decline has accelerated, with the asset losing 23% over 83 days since breaking the key technical level on Nov. 12, 2025.

Onchain data confirms the bearish trend, with key metrics showing structural weakness. Bitcoin's Bull Score Index has dropped to zero, the lowest reading possible, indicating a deeply bearish market. The index had peaked at 80 in early October but turned negative after a major liquidation event and continued to fall as prices declined.

The current price action suggests that Bitcoin could test the $70,000–$60,000 support zone. This range includes important levels such as the previous cycle all-time high of $69,000 and an estimated production cost of $65,000–$70,000. Cryptoquant's head of research, Julio Moreno, noted that the $60,000 level could take several months to reach.

Why Did This Happen?

A key factor driving the bearish trend is a sharp reversal in institutional demand. U.S. spot Bitcoin ETFs, which were net buyers of more than 46,000 BTC at this time last year, have turned into net sellers in 2026. The shift has created a demand gap of roughly 56,000 BTC compared with 2025, contributing to persistent selling pressure.

The reversal in institutional flows is compounded by weak U.S. retail participation. The Coinbase premium, which measures the price difference between Coinbase and global exchanges, has remained negative since mid-October. Historically, strong U.S. demand has driven positive premiums during bull markets, but this dynamic is no longer present.

How Are Markets Responding?

The broader crypto market is also affected by the bearish sentiment. Liquidity conditions are tightening, with Tether's USDT stablecoin market capitalization showing its first contraction since October 2023. The 60-day growth of USDT has turned negative by $133 million, a sign consistent with liquidity contraction during bear market phases.

Long-term demand growth has also collapsed, with Bitcoin's annual spot demand growth falling from 1.1 million BTC to 77,000 BTC over the past four months—a 93% decline. This indicates that most of the demand growth from this cycle has already occurred, creating a bearish backdrop for prices.

What Are Analysts Watching Next?

Technical indicators reinforce the bearish outlook. Bitcoin has fallen below its 365-day moving average, confirming a downward trend. The performance since breaking the level has been worse than the start of the previous bear market in January 2022.

Cryptoquant noted that the current bear market is off to a weaker start than the 2022 cycle. The firm added that without a return of spot buyers, any near-term rallies are likely corrective, leaving Bitcoin vulnerable to further downside during a prolonged reset according to Cryptoquant analysis.

Bitcoin could fall toward $63,800 if the current pattern of coordinated selling persists, as indicated by veteran trader Peter Brandt. He described the pattern as "campaign selling," driven by large market participants rather than retail panic.

The U.S. strategic Bitcoin reserve has also been affected by the price decline. The value of the reserve has fallen by about $4.7 billion from its estimated $18.5 billion in March 2025. Despite the drop, the Trump administration has maintained its stance that the government will not sell the cryptocurrency as reported.

Bitcoin's continued decline reflects broader structural weakness in the crypto market. Analysts are watching for signs of renewed institutional or retail demand, as well as any shifts in macroeconomic or regulatory conditions that could alter the bearish outlook according to market analysis.