Bitcoin's 20% Loss Doesn't Mean the Cycle Has Bottomed

Bitcoin has fallen below the average cost basis of active traders, leaving them with an average unrealized loss of 20%. According to Darkfost, a CryptoQuant contributor, this average price is around $76,700. In previous bear markets, losses for active investors widened to 40% to 50%, indicating that the current drawdown does not yet suggest a market bottom.

Despite inflows from institutional investors and spot exchange-traded funds (ETFs), Bitcoin has remained in line with its historical cycle pattern. However, this cycle could rebound without first falling into the 40% to 50% loss range seen in the past.

A forecast report by PeriodShort-term indicates that if the average cost basis for active investors falls below $76,700, it could trigger short-term selling pressure as Bitcoin losses widen. On the other hand, an RSI of 43, an improving MACD, and a funding rate of 0.01% suggest there is room for a rebound.