Short -term price dips are par for the course at Bitcoin’s (BTC) Bull Markets, but an indicator suggests the current decline from recent highs may reflect a deeper structure that transfers to dynamic markets.
Bitcoin traded around $ 84,000 as European morning hours on Friday, a 23% fall from the peak this January $ 109,000. Autumn is furious by investors and debating a debate if it marks the start of a new bear market or a rapid correction within a broader bullish trend.
Such pullbacks are not uncommon – the BTC has been the welcome of similar declines to previous bull cycles, which often bounce at new heights. However, the on-chain analysis firm Cryptoquant’s Bull Score Index, an integrated scale designed to measure Bitcoin market health, shows signs of deeper weakness.
The index examines ten critical indicators – spanning network activity (such as transaction volume), investor profitability, marketing market, among other factors, which assigns a mark from 0 to 100. Higher scores indicate a stable, bullish environment, while lower reading of flag conditions.
So far, the Bull Score Index is sitting at a stressful 20-the lowest since January 2023, when Bitcoin sat around $ 16,000 posting the fall of the after-Behemoth Crypto Exchange FTX.
Eight out of ten metrics monitored by index show warning signs, with network activity bearish since December 2024 and dried volume of transaction and liquidity.
“Historically, Bitcoin has only achieved major price rallies when the bull mark is over 60, while the prolonged reading below 40 is aligned with the bear markets,” said cryptoquant analysts in Thursday’s report.
The investor’s profitability is lost as Short -term holders face unlucky lossesWhile the demand softens -the US spot bitcoin ETFs, once aggressive consumers, registered a net $ 180 million flows over the past 30 days, or among the highest backward rates since they started trading at the beginning of 2024.
In the previous cycles, the readings below 40 for weeks or months had previously expanded bear phases, such as the 2022 slump that saw Bitcoin pour over 60% of its value from the peak.
The coming weeks will be pivotal. Either the index rebounds, signing the strength changed, or it is below 40, which is a bearish shift cement that can test $ 80,000 Bitcoin support -a that -analysts of analysts as a critical level to watch.
