Bitcoin’s (BTC) ongoing volatility below the $110,000 mark is raising questions about whether the asset is destined for further losses, but historical data suggests otherwise.
According to on-chain data shared by analyst Ali Martinez, Bitcoin’s trader profit/loss margin currently sits around -5%. Historical patterns show that when this margin drops below -12%, the cryptocurrency tends to rebound strongly, signaling the end of major downtrends.
Martinez’s data, retrieved from CryptoQuant on October 22, shows deep negative margins, indicating widespread unrealized losses among short-term holders, which have historically aligned with cyclical bottoms in Bitcoin’s price.
Bitcoin profit/loss margin. Source: CryptoQuantEach instance, including those in 2019, 2020, and 2022, preceded significant recovery phases.
Meanwhile, Bitcoin’s realized price, the average price at which all coins were last moved on-chain, remains below the spot price, meaning the majority of investors are still in profit. This suggests the market has not yet reached the level of widespread capitulation seen in previous bear market lows.
The reassuring data comes as Bitcoin lost the $110,000 level in the past 24 hours, with broader markets suffering losses amid profit-taking. In the short term, however, technical indicators suggest BTC is not yet out of the woods.
Bitcoin under threat of dropping to $100,000
For instance, pseudonymous cryptocurrency analyst BitBull noted in an X post on October 22 that Bitcoin has fallen below its weekly bull market support band, around $110,000, a technical zone that has recently acted as a crucial indicator of trend strength.
In past cycles, similar breaks have often triggered 10% to 20% corrections, as traders reassess momentum and short-term sentiment turns cautious.
If history repeats, a pullback of that magnitude could see Bitcoin revisiting levels around or even below $100,000, a psychologically important threshold.
However, the analyst emphasized that temporary dips below the support band do not always signal a full trend reversal, especially if BTC quickly reclaims the zone in subsequent weeks.
Bitcoin price analysis
By press time, Bitcoin was trading at $108,224, down 0.5% in the past 24 hours and 3% on the weekly timeframe.
Bitcoin seven-day price chart. Source: FinboldAs things stand, Bitcoin’s next key objective remains reclaiming the $110,000 resistance. A drop toward $105,000, however, could open the door for further losses toward the $100,000 level.
Featured image via Shutterstock
Source: https://finbold.com/is-bitcoin-in-capitulation-territory/
