Bitcoin entered February under renewed pressure after losing a key technical support level, with price behaviour increasingly resembling patterns seen in previous bear markets. Analysts point to a familiar sequence: support failure, a breakdown in market confidence, and the realised price level flipping from support into resistance — a structure historically associated with extended downside phases.
Support failure shifts market structure
In recent sessions, Bitcoin slipped decisively below a widely monitored support zone that had previously stabilised price action. Once that level failed, selling accelerated as leveraged positions were unwound and short-term traders exited. The speed of the move reinforced concerns that the market is transitioning from consolidation into a deeper corrective phase rather than a temporary pullback.
Realised price flips to resistance
A key signal highlighted by analysts is the behaviour of Bitcoin’s realised price — the average cost basis of all coins in circulation. In past cycles, sustained trading below realised price has marked prolonged bear markets. The recent flip of this metric from support into resistance suggests that many holders are now underwater, reducing the incentive to buy aggressively on dips and increasing the risk of further capitulation.
Bear market echoes from history
Historical comparisons are driving much of the current caution. In prior downturns, Bitcoin often experienced an initial sharp sell-off, followed by a period of false stabilisation before another leg lower. The present setup, with weakening momentum and repeated rejection at lower highs, mirrors those earlier phases. While history never repeats perfectly, the similarities are close enough to influence sentiment among both traders and long-term investors.
Liquidity and macro pressure
Broader financial conditions are adding to the downside risk. Tighter liquidity, higher real interest rates, and a stronger focus on risk management across asset classes have reduced speculative inflows into digital assets. Bitcoin, which benefited from abundant liquidity during expansionary cycles, has historically struggled when capital becomes more selective. This macro backdrop limits the likelihood of a swift recovery without a clear shift in monetary expectations.
On-chain signals remain mixed
Not all indicators point decisively lower. Long-term holder activity suggests limited panic selling, indicating that core investors remain relatively disciplined. However, the absence of strong accumulation at current levels also implies caution rather than confidence. This combination — weak demand but restrained forced selling — is consistent with grinding bear-market conditions rather than a sharp, V-shaped rebound.
Psychological levels under threat
As price action weakens, attention is turning to lower psychological support zones. A sustained break below these levels would likely reinforce bearish narratives and trigger further defensive positioning. Conversely, reclaiming the realised price would be required to invalidate the current bearish structure — a move that, at present, appears technically challenging.
What this means for investors
For short-term traders, volatility and downside risk dominate the outlook. For longer-term participants, the current phase reinforces the importance of position sizing, liquidity management, and realistic time horizons. Past cycles show that prolonged drawdowns can persist even after initial optimism fades.
Bottom line
Bitcoin’s latest price action is less about headlines and more about structure. The loss of key support and the flip of realised price into resistance place the market in a historically vulnerable position. While long-term adoption narratives remain intact, near-term risks are skewed to the downside, echoing patterns seen in earlier bear markets.
Newshub Editorial in North America – 1 February 2026
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