CryptoQuant Says Bitcoin Is Tracing 2022 Bear-Market Pattern, With $70,000 Support in Focus
Forecast Trend Report by Period
Bitcoin is showing a pattern similar to the one seen during the 2022 bear market, according to a CryptoQuant analysis.
The Block reported on May 20 that CryptoQuant Head of Research Julio Moreno wrote in a report that Bitcoin's current price action closely resembles the pattern that followed the March 2022 rebound, when the token turned lower again.
Bitcoin recently met resistance near its 200-day moving average at $82,400 before sliding to around $76,000, Moreno wrote. In March 2022, Bitcoin rebounded about 43% from its low, then failed at the 200-day moving average and resumed its decline. In the current cycle, it has risen about 37% from its April low and reached the same resistance zone.
During bear-market phases, the 200-day moving average has served as a key line separating a rebound rally from a renewed downtrend. Failing to break above that level is a strong technical signal that the broader bear-market structure remains intact.
On-chain demand indicators are also weakening. Moreno said speculative demand in the perpetual futures market, which drove the April-May rebound, faded quickly after Bitcoin broke above $82,000. Liquidations of leveraged long positions have continued, while the decline in spot demand is also accelerating.
Flows into U.S. spot Bitcoin exchange-traded funds were also cited as a bearish factor. The funds had been net buyers of about 64,000 BTC over the previous 30 days, but recently shifted to net selling of about 4,000 BTC, Moreno wrote.
He also pointed to the Coinbase Premium remaining negative during both the recent rebound and the correction. That indicates demand from U.S. institutional and retail investors has yet to return in force.
CryptoQuant's Bull Score Index has also worsened. The indicator recently fell to 20 from 40, a level CryptoQuant classifies as "extremely bearish." In the past, readings between 0 and 20 were often followed by further declines or extended sideways trading, according to Moreno.
Moreno identified the area around $70,000 as the next key support level. The trader on-chain realized price, which stands near $70,000, could serve as a major floor. At that level, most investors' unrealized gains tend to disappear, which has historically eased selling pressure.
