Bitcoin Drop Accelerates as Market Enters Bear Territory—Key Support Levels Crumble

Bitcoin is experiencing a significant decline, with technical indicators and on-chain metrics now signaling the potential onset of a bear market phase. The cryptocurrency has slipped below critical support zones, triggering sharply negative sentiment among traders and analysts. Current price action suggests a structural shift that echoes patterns seen during previous bearish cycles.

Current Price Action Signals Structural Bear Market Risk

As of February 2026, Bitcoin is trading at $68.94K, representing a notable pullback from earlier resistance levels. The latest drop has pushed the asset into a zone where fundamental support has evaporated, leaving bulls struggling to mount a defense. Data shows that BTC recently broke below the $80,000 mark during sharp intraday selling, briefly touching $77,600—levels not seen in months. The failure to hold these support zones has accelerated bearish narrative, with many participants now questioning whether a prolonged decline is underway.

The psychological and technical importance of $80,000 cannot be overstated. This level represented a major bull-market support zone and acted as a psychological barrier for risk-on trading. Its loss suggests that the market structure has fundamentally weakened, opening the door to deeper pullbacks.

Technical Breakdown: How Bitcoin’s Drop Mirrors Past Bear Market Cycles

One of the most telling technical signals is Bitcoin’s break below the 21-week exponential moving average (EMA)—a level that has historically preceded major bear market phases. According to analysis from recognized on-chain researchers, this crossover pattern last appeared in April 2022, immediately before an extended bear market decline that lasted months.

The current situation mirrors that cycle with striking similarities. Since the latest EMA crossover, Bitcoin has already experienced a sharp drop of approximately 17% from its recent peak near $90,000, moving down to current levels. This consistency in structure suggests that historical precedent could play out again, though past performance does not guarantee future results.

Technicians are also monitoring CME futures gaps near $84,000. CME gaps often function as price magnets in crypto markets, potentially offering a short-term bounce opportunity. However, many traders view such relief rallies as temporary capitulation relief rather than the start of a new bull phase.

On-Chain Data Paints a Bearish Picture

CryptoQuant’s latest research reinforces the risk-off sentiment by highlighting a critical threshold: Bitcoin is now trading below the realized price—the average cost basis where coins last moved hands. Specifically, BTC has dropped below the realized price of investors who accumulated holdings between 12 and 18 months ago.

Historically, this divergence carries significant weight. When Bitcoin trades below realized cost for an extended period, markets frequently transition from normal corrections into structural bear regimes. In the current environment, realized price is acting as overhead resistance, meaning that any attempt to rally faces selling pressure from holders trying to exit at breakeven levels.

The combination of negative factors—price below realized cost, slowing growth metrics, and increased on-chain seller activity—aligns with the conditions that preceded extended bearish phases in previous cycles.

Where Could Bitcoin Bottom? Traders Eyeing Multiple Bear Targets

If the decline accelerates further, traders have identified key downside liquidity zones. The next major technical target sits near $74,400. However, in a more severe bear scenario, some analysts have highlighted $49,180 as a possible lower bound—a level representing a substantial bear market drawdown from current prices.

The discussion of such deep targets illustrates how quickly market sentiment has shifted. Within weeks, participants have moved from defending $80,000 to openly discussing a potential drop that could exceed 25% from current levels if structural support fails entirely.

Risk Management in a Potential Extended Bear Phase

The convergence of technical signals, on-chain metrics, and historical pattern repetition suggests caution is warranted. While short-term bounces are possible—particularly toward the $84K CME gap—the broader trend remains vulnerable. The loss of key support zones, combined with weakening on-chain fundamentals, points toward a risk-off environment that could persist.

Traders should maintain disciplined risk management strategies and avoid overextending positions in the current environment. The bear market narrative is gaining strength, and technical structure supports further downside unless major support is reclaimed soon.

Disclaimer: This analysis is for informational purposes only and does not constitute financial advice. Always conduct your own research before making investment decisions.