As Bitcoin attempts to maintain its position above $90,000, some analysts warn that signs of a bear market are growing more evident, indicating a potential drop to new lows in the near future.
Bear Flag Pattern Sparks Concern
On Friday, Bitcoin erased its gains from the previous day, falling 3.2% intraday to revisit the $89,500-$90,500 support zone. The cryptocurrency has been fluctuating between $84,500 and $94,500 for the past four weeks, briefly hitting a seven-month low of $80,600 during the late November correction.
This week, Bitcoin experienced heightened volatility, driven by expectations of a Federal Reserve interest rate cut and positive regulatory news in the U.S. However, BTC has repeatedly failed to break and sustain a position above the upper limit of its recent range, ultimately falling back toward the middle of the band.
Analyst Ted Pillows pointed out a worrying pattern on Bitcoin’s chart, cautioning that the cryptocurrency could fall to new multi-month lows if key support levels are not held. According to his analysis, BTC has been forming a bear flag pattern for nearly a month—a signal that is “too hard to ignore” as the price continues to face rejection at the upper boundary of the formation.
He noted that this pattern is part of a trend that has been developing over the past two months. Since the market pullback on October 10, bearish flags have repeatedly appeared on Bitcoin’s chart, with each one resulting in a breakdown to lower levels. To Ted, this latest formation suggests “that the overall trend is still to the downside.”
He indicated that a close above $96,000 would negate the bearish pattern. Conversely, a drop below the $86,000 support—where the lower boundary of the formation lies—could push Bitcoin down toward the April lows around $76,000.
Is History Repeating Itself?
The analyst also observed similarities between the current market cycle and the previous one, which could lead to a decline below $70,000. The chart shows that after falling below the 50-week EMA, Bitcoin consolidated within a bear flag before breaking down and dropping toward the 2022 lows.
Currently, BTC is showing similar behavior after losing the 50-week EMA and breaking down from its October bear flag. “If this plays out, a pump to $100,000 and then a dump below $70,000” could follow, the analyst added.
Meanwhile, Robert Mercer shared a comparable view in a series of posts. He argued that the classic four-year cycle remains unchanged despite increased institutional adoption, stating that Bitcoin is gradually breaking key support levels and entering a bear market—similar to what happened at the end of 2021.
At present, BTC is forming an ascending channel with a top near $100,000–$104,000, and a clear right shoulder of a head-and-shoulders pattern is visible in this move. Mercer noted that a similar pattern emerged in early 2022.
He also pointed out that Bitcoin is trading below the 1-week MA50 for multiple consecutive weeks—the first time this has occurred in the current bullish cycle. However, he concluded that “no such breakdown happens without a retest,” predicting a relief bounce to $98,000–$102,000 followed by a drop to the $55,000–$60,000 support zone.
As of this writing, Bitcoin is trading at $89,990, reflecting a 2.75% decline over the past 24 hours.
Frequently Asked Questions
Frequently Asked Questions About Bitcoins Bearish Outlook
Beginner Questions
What does bearish mean for Bitcoin
Bearish means theres a widespread expectation that Bitcoins price is likely to fall or enter a period of decline
What are bearish indicators
These are specific signals or patterns in market datalike price charts trading volume or investor sentimentthat historically suggest a price drop may be coming
Why are analysts talking about Bitcoin falling to April lows
In April 2024 Bitcoins price dropped to a certain low point Some analysts see current signals mirroring those from that period warning we could see a similar price level again
Should I panic and sell my Bitcoin if I hear this
Not necessarily Market predictions are not certainties Its important to assess your own investment goals risk tolerance and not make decisions based solely on fear or a single analysts view
What causes Bitcoins price to go down
Many factors can contribute including negative news large investors selling broader economic uncertainty regulatory crackdowns or a general shift in market sentiment from greed to fear
Intermediate Advanced Questions
What specific indicators are analysts pointing to as bearish right now
Common ones include Bitcoin failing to hold key support levels declining trading volume on rallies a drop in network activity sustained outflows from Bitcoin ETFs and a bearish divergence on momentum indicators like the RSI
What are April lows and why are they significant
The April lows refer to the lowest price Bitcoin hit in April 2024 This level is significant because it acted as a major support floor If broken it could trigger further selling as it would invalidate a previous area of buyer strength
Is this a normal part of a market cycle
Yes Bitcoin is known for its volatility and cycles of bull and bear markets Corrections of 2030 or more are not uncommon even within longerterm uptrends
How does this relate to the Halving event
The Halving reduces the new supply of Bitcoin Historically its preceded a bull market but not immediately Periods