The Bitcoin market is sending more and more warning signals. On-chain data indicates that demand in the spot market is fading, and the price structure suggests increasing risk. More and more analyses suggest that the bear market may just be beginning.
The latest posts published by CryptoQuant, Coinbureau, and the company Alphractal show a consistent picture of changing market behavior. On one hand, the demand that previously drove the increases is weakening. On the other hand, the price of Bitcoin is trapped between key liquidation zones.
Spot demand is fading - a classic signal of the beginning of a bear market?
Analysts from CryptoQuant, a renowned on-chain data analysis platform, point out the waning of the demand boom for BTC. The current Bitcoin bullish cycle has been based on three waves of spot demand. The last one is clearly losing momentum. The platform wrote in a post on X:
"The demand boom for Bitcoin is waning. This cycle has gone through three waves of spot demand, and the last one seems to be ending. Since the beginning of October, demand has remained below trend, which could negatively impact the price."
Since the beginning of October, spot demand has been declining and remains below the long-term trend. Historically, such a setup often appears in the early stages of a bear market. Coinbureau, a popular analytical and educational portal for the cryptocurrency market, refers to this data directly. According to them, the decline in demand is one of the most important signals of a phase change in the cycle.
The decline in demand means a smaller influx of fresh capital. In such conditions, increases become fragile. The market begins to rely on speculation and leverage. This environment favors increased volatility and sudden price movements.
Meanwhile, one user on platform X notes that market peaks usually occur in November, but accelerated activity from institutional whales could have shifted it to October. In their opinion, the traditional market cycle has come to an end, and the next price impulse may arise from global adoption of Bitcoin or the narrative surrounding it. Ace Crypto wrote:
"The market peak usually occurs in November. Institutional whales have accelerated, so the peak happened in October. What we consider a normal cycle has come to an end. What is coming is unprecedented. Global adoption or rumors of adoption will be responsible for the next impulse."
Bitcoin between liquidation zones and a struggle for liquidity - the decline in demand gives wings to the bears
At the same time, the company Alphractal, specializing in advanced investment data and quantitative analysis, identifies two key liquidation levels. Short positions are concentrated around $95,000. Meanwhile, liquidity of long positions dominates around $82,000.
As a result, the price of Bitcoin remains compressed between these levels. Such a structure indicates a balance that rarely lasts long. The market tends to seek liquidity before defining the next trend. Alphractal shared in their latest post:
"Bitcoin is trapped between two main liquidation zones. $95,000 → high concentration of short positions (bear liquidations). $82,000 → high concentration of long positions (bull liquidations). The price is compressed between these levels, and the market tends to seek liquidity before defining the next trend."
Meanwhile, under conditions where demand is fading, there is a greater risk of a downward move. Breaking below the liquidation zone could trigger a domino effect for Bitcoin. This scenario is often observed in the initial phase of a bear market.
What do these signals mean for market observers?
The decline in spot demand and price compression creates a dangerous mix. In this context, on-chain data suggests a change in market structure, rather than just a temporary correction. In such conditions, managing risk and protecting capital becomes crucial.
A bear market does not always start with a sharp decline. It often develops gradually as market fundamentals weaken. As a result, current data suggests that such a process may already be underway.
Nevertheless, the Bitcoin market is at a turning point. The decline in spot demand and the concentration of liquidity in liquidation zones suggest that the previous bullish narrative is losing strength. If these signals persist, investors may be facing the beginning of a longer bear market. The coming weeks may prove crucial for the market's further direction.
To read the latest cryptocurrency market analysis from BeInCrypto, click here.
