 ▲ Bitcoin (BTC), decline, bear market/AI-generated image |
Investor anxiety is reaching a peak as Matrixport has warned that Bitcoin (BTC) has entered a full-fledged bear market after breaking below a key support level.
According to cryptocurrency-focused media outlet U.Today on February 16 (local time), global digital asset analytics firm Matrixport stated in its latest report, “Matrix on Target,” that Bitcoin’s drop below major support levels has confirmed a downward trend. The firm characterized the current market environment as the early stage of a bear market rather than a simple correction, noting that the scale and speed of the decline are unfolding similarly to past historical cycles.
Technically, the most alarming signal is that Bitcoin is trading below its 21-week moving average. Matrixport explained that the 21-week moving average, which had served as solid support during previous bull markets, has now turned into strong resistance, significantly weakening upward momentum. The recent drop toward the $87,000 level represents the unwinding of fragile market positions, and the report projected that the downward trend is unlikely to reverse easily despite short-term rebound attempts.
The focus of market participants is also shifting rapidly. Matrixport noted that investors are now less concerned with whether a trend reversal is imminent and more focused on identifying an opportune time to reallocate assets. The report also suggested that its previous forecast of Bitcoin reaching $125,000 this cycle had already peaked between late 2024 and October 2025 before turning lower.
The macroeconomic environment is also moving in an unfavorable direction for Bitcoin. Matrixport pointed out that during U.S. midterm election years, increased policy uncertainty and a tendency toward reduced risk appetite tend to coincide with Bitcoin’s four-year cycle, deepening bear markets. While a weaker dollar could temporarily provide relief to the market, the firm warned that without substantial new capital inflows, it will be difficult to withstand liquidation pressure in the derivatives market.
It may take considerable time for Bitcoin to reach the bottom of the current downturn. Matrixport emphasized that the current pace of decline closely mirrors previous down cycles and that the market must undergo a sufficient reset phase to cool overheating. Investors are advised to maintain a conservative strategy rather than rushing to buy the dip, waiting instead for clear signals that the market structure has shifted back to a bullish trend.
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