In the midst of a bearish market phase, Bitcoin (BTC) is currently facing a continual downtrend, with its price hovering below $90,000. Many investors are keenly observing the market trends to predict the potential bottom before any significant rebound. The current condition could change at the $80,000 support level, which, if maintained, could possibly deter further losses. This period of market volatility is underscored by a significant capital outflow, making it a critical point for the cryptocurrency.
Artificial Intelligence Predictions
Finbold consulted the latest artificial intelligence (AI) model — Grok 3, by xAI — to evaluate when Bitcoin might hit its bottom. According to the model, the correction phase of Bitcoin seems to be reaching its end, indicating a potential bottom formation in the weeks to come.
Bitcoin’s all-time high of $108,000 was recorded in late January, followed by a downturn. The AI model noted that corrections of 20% to 40% post parabolic rallies are common in BTC’s history, making the current setback not an anomaly. In this context, it was highlighted that $80,000 is a vital psychological and historical support level. In a more pessimistic scenario, the prices could further dip into the range of $74,000 to $78,000.
When will BTC bottom?
The post-halving cycle of Bitcoin also influenced Grok 3’s forecast. Historical trends, post the April 2024 halving, suggest that bull markets usually peak 12 to 18 months later. This translates to a potential peak between April and October 2025. Based on these trends, Grok 3 proposed that the current decline is more likely a mid-cycle correction as opposed to the onset of a long-lasting bear market.
The AI model estimates that Bitcoin is likely to bottom out between mid-March and early April, possibly stabilizing in the $78,000 to $82,000 range before it consolidates. These predictions, however, could be influenced by external factors like changes in regulations, demand from institutions, and macroeconomic conditions.
Bitcoin in a macro trend shift
Technical indicators are signaling a significant shift in Bitcoin’s macro trend, according to the Bull-Bear Market Cycle Indicator. Data shared by CryptoQuant, an on-chain cryptocurrency analyst, suggests Bitcoin has entered an extreme bearish phase. The indicator dipping below zero can be seen as a harbinger of deeper corrections.
The indicator uses Bitcoin’s 365-day and 30-day moving averages (MA) to identify broader market trends. The value moving below zero is interpreted as an entry into an extended period of bearish phase or the final phase of correction before recovery sets in.
Bitcoin on the verge of a rebound
Despite the bearish outlook, there are indicators to suggest Bitcoin could be nearing a rebound. CryptoQuant data shows Bitcoin’s on-chain trader realized loss margin has hit -14%, surpassing the typical -12% threshold that has often marked the bottom before a recovery.
Bitcoin’s realized price currently stands at $99,250, while the market price is around $85,000. Historical data suggests that such a capitulation often precedes strong rebounds as sellers exhaust their positions and demand increases. This could potentially lead to a sharp reversal for Bitcoin, retesting previous highs.
Bitcoin price analysis
At the time of writing, Bitcoin was trading at $85,867, a 1% increase within the last 24 hours. However, over the course of the week, the digital currency has seen a plunge of over 10%. The $80,000 support level remains a critical factor in preventing further declines. On the flip side, $90,000 serves as a key resistance level. Any break below the support could spur more downturn, whereas reclaiming $90,000 may confirm a rebound.
FAQ
1. What does a bearish market mean in the case of Bitcoin?
Answer: A bearish market indicates a decline in Bitcoin’s price, often due to a variety of factors such as sell-offs, negative market sentiment, or other broader economic factors.
2. Can artificial intelligence accurately predict Bitcoin prices?
Answer: While artificial intelligence can offer insights based on historical data and trends, they are not infallible. Predictions should be used as a reference guide and not the sole basis for investment decisions.
3. How long could the current bearish trend of Bitcoin last?
Answer: The duration of bearish trends can vary, often depending on a multitude of factors including market conditions, demand, and external economic factors.
4. What is the significance of the $80,000 support level for Bitcoin?
Answer: The $80,000 support level is significant because if prices fall below this point, it could potentially trigger further declines. However, if prices remain above this level, it may help to stabilize the market and prevent further dips.
