Bitcoin's technical outlook is weakening, with bearish forces continuing to dominate the market.

Entering a new year, Bitcoin’s performance is disappointing. According to the latest data, Bitcoin is currently hovering around $91,950, well below the $126,080 all-time high set six weeks ago, with a year-to-date decline of 6.84%. Against the backdrop of a continued market downturn, a large number of high-level buyers are facing collective losses, and trading sentiment is extremely pessimistic.

The Market Demand Wave Has Already Faded

Based on CryptoQuant’s latest analysis, the core demand factors supporting Bitcoin’s rise in this cycle are waning. Specifically: the pace of ETF holdings increase has significantly slowed, institutional investors (such as MicroStrategy and other companies) have almost halted their coin-buying activities, and the annual institutional strategic fund purchases have fallen to historic lows.

This shift implies that, although Bitcoin will not crash immediately, its upward potential has been greatly compressed. Analysts point out that future rebounds may encounter resistance below the 365-day moving average, until a new round of buying demand emerges.

Traders’ Bearish Sentiment Is Warming

In the predictive market, bearish bets have overwhelmingly become mainstream. According to trading data, up to 73.3% of funds are betting on Bitcoin falling to $85,000, while only 26.7% are betting on a rise to $115,000 — a highly stark contrast.

The situation for Ethereum is similarly pessimistic. Currently trading near $3,220, users estimate a 62% probability of further decline to $2,500, far higher than the expectations of rising to $4,000. Although XRP and Solana increased by 2.14% and 1.00% respectively yesterday, this did not change the overall bearish outlook.

Technical Indicators All Signal Red

Bitcoin’s current technical state is in multiple weak conditions:

Death Cross of the Exponential Moving Averages (EMA): The 50-day EMA has officially fallen below the 200-day EMA, a notorious signal often indicating the start of a long-term bearish trend. Bitcoin is now well below these two moving averages, forming a significant overhead resistance zone. Bulls need to regain these key levels to achieve a rebound.

Average Directional Index (ADX) reaches 38.25: An ADX above 35 indicates a very strong trend. This suggests that the current decline is not chaotic oscillation but a genuine and powerful selling wave. The extreme fear reading on the Crypto Fear & Greed Index also confirms this judgment.

Relative Strength Index (RSI) plunges into severe oversold territory: RSI has fallen to 27.12, deep into oversold (below 30). This indicates Bitcoin’s price has been “pulled to the limit,” which does not mean an immediate bottom, but usually hints at trend exhaustion and the potential for a strong rebound soon.

Key Support and Resistance Levels Analysis

If Bitcoin loses the current testing zone of $88,000-$89,000, it will face multiple downside targets:

Support levels:

• First Fibonacci support: $84,451
• Strong support: $71,486

Resistance levels:

• Recent resistance: $92,000
• Downtrend line resistance: $100,492

Given the RSI is severely oversold, a quick dip to $85,000 (wick) is very likely rather than a sustained breakdown. The so-called “capitulation drop” usually reverses quickly after clearing excessive leverage longs.

How Difficult Is the Upside Scenario?

To realize the highly anticipated rise to $115,000, Bitcoin needs to accomplish two daunting tasks: first, repair the EMA death cross; second, break through the descending trendline (around $100,492). The difficulty of this explains why less than 27% of traders are betting on an upward move.

The Next Few Weeks Will Be Critical

The current market crossroads will determine the next trend direction. On one hand, the oversold RSI could trigger a quick rebound; on the other hand, if support continues to fail and downside momentum takes further control, the market could evolve into a bear market structure similar to 2022-2023.

For investors, the coming weeks will be a decisive period to observe whether buying demand can regain dominance or if support failure will deepen the downward trend. In this uncertain moment, risk management and position control are especially important.