Bitcoin crashes, has it hit bottom? Analyst: Still not out of danger

Bitcoin on-chain data recently showed signs of a turning point, as the trend seems to have reached a critical juncture. However, several key indicators that are typically seen at market bottoms during bear markets have not yet fully materialized. CryptoQuant states that the market is currently hovering between "mid-term correction" and "full reset," with investors still divided on whether the bearish sentiment has been fully exhausted.

According to indicators tracked by CryptoQuant, including the surrender level of long-term holders, MVRV (Market Value to Realized Value), NUPL (Unrealized Profit and Loss), and profit-taking ratios, all remain in an awkward middle ground—neither a simple correction nor a panic-driven capitulation.

CryptoQuant’s report notes that historically, during true bear market bottoms, long-term holders typically endure about 30% to 40% unrealized losses. However, current data shows that the profit levels of long-term holders have only fallen from last October’s peak return of 142% to near break-even, indicating that a true capitulation sale is still far off.

Bitget Chief Analyst Ryan Lee commented, "I also believe the macro bottom has not yet been established." He analyzed that market liquidity remains tight, and risk assets are highly sensitive to overall economic data. "If the stock market weakens further, the cryptocurrency market could see one last wave of comprehensive shakeouts."

From a technical perspective, the MVRV Z-score has not yet fallen into the historically bottoming range (around -0.4 to -0.7). As for NUPL, it is currently around 0.1, whereas during past market bottoms, it has typically been accompanied by holders experiencing an average of about 20% unrealized losses.

After the U.S. released better-than-expected employment data, market focus shifted to January’s inflation figures. If inflation unexpectedly accelerates, it could reinforce expectations of prolonged high interest rates, further suppressing risk assets including Bitcoin.

However, some market observers remain cautiously optimistic. Sean McNulty, Head of Derivatives Trading for APAC at FalconX, an over-the-counter institutional broker, pointed out that the Crypto Fear & Greed Index briefly dropped to 11/100 on February 11, indicating extreme fear in the market and suggesting selling pressure may be nearing exhaustion.

McNulty added that after Bitcoin briefly tested the $60,000 psychological level last week, it rebounded sharply within 24 hours by 19%, with 66,940 BTC flowing into "HODL addresses," setting a new record. In other words, institutional "whales" are actively defending the $60,000 to $62,000 range, building a defensive line.