Bitcoin’s current market outlook is similar to the bear market conditions observed in the final months of 2022. This assessment was brought to the agenda by Vetle Lunde, analyst of K33 company, known for its digital asset analysis. Lunde pointed out that the crypto asset’s recent price movements and trading activity point to a process in which speculative fluctuations have largely decreased.
Price Dynamics Similar to a Bear Market
Vetle Lunde stated that the recent price movements in Bitcoin reflect market behavior seen during long periods of decline in the past. While Lunde pointed out that open positions and leverage in the futures market have decreased significantly, he emphasized that the overheating in the market may be behind us. It is reported that such broad-based market resets often coincide with the final periods of long-lasting retreats.
Extreme Fear in Market Sentiment
The recent sharp decline in sentiment indices reinforces this finding of the analysis. The Fear and Greed Index, which is shaped according to investor preferences in the crypto market, has fallen to extreme fear levels again. It is stated in the industry that these levels mostly coincide with periods when weak investors withdraw from the market and price volatility decreases.
In particular, the decline in volatility has created a picture that coincides with long-term opportunity zones in the past. However, it is emphasized that such changes observed in the market structure do not mean an immediate price return. Yet historical analysis indicates that many recoveries follow similar conditions.
Horizontal Trend Risk and Long-Term Prospect
K33 analyst Lunde predicts that Bitcoin may fluctuate in the $60,000 to $75,000 range in the near term. It is evaluated that such a consolidation process may challenge short-term-oriented investors, but may create a new savings opportunity for investors with a long-term perspective.
From this perspective, current market conditions appear to have significantly cleared the market of unnecessary leverage and excessive speculative optimism, similar to the previous bottom processes in late 2022. Similar structural signals have provided a basis for market recovery in the past; However, it cannot be said that these processes brought a clear increase in a short time.
According to Lunde’s assessment, although there is a significant improvement in the market, investors need to be patient. Beyond short-term price movements, it is reported that such horizontal consolidation periods can lay the groundwork for a strong upward movement.
Vetle Lunde emphasized that Bitcoin’s current market outlook offers an accumulation opportunity for long-term investors, but a new rise should not be expected immediately in the short term.
The current market structure, which is similar to past cycles, requires investors to remain careful and patient in the coming period. A balance has been established in the market, especially with the decrease in over-leveraged positions.
