[Analysis] "Bitcoin, investor sentiment contracts after breaking the 50-week moving average… Bearish sentiment spreads amid talk of cycle end"

Bitcoin (BTC) has fallen 27% from its all-time high, and there is analysis that talk of the cycle ending has further stoked bearish sentiment.

On the 18th (local time), QCP Capital said in a report, "Last week Bitcoin's decline deepened and it broke below the 50-week moving average. For the first time since May, the weekly close fell below $100,000, leaving investor sentiment further contracted," and "In this context, talk of the four-year cycle ending further fueled bearish sentiment," the report said.

According to the report, technically BTC has entered a zone testing support in the $92,000 range. This price range served as a strong support in Q4 last year and Q1 this year, and overlaps with a CME unfilled gap formed in April. Because of this, some mention the possibility of a short-term technical rebound, but the thick order book identified in recent weeks and slowing buy inflows may limit the strength of any rebound. Despite the end of the U.S. government shutdown, the slow pace of liquidity recovery is also cited as a headwind.

Caution is clearly evident in the derivatives market. Short-dated implied volatility for Bitcoin options exceeds 50%, and a put-option bias persists, keeping downside hedge demand high. QCP Capital analyzed, "With the breakdown of the 50-week moving average strengthening the mid-term bearish trend, $88,000 and $74,500 are cited as key support levels," and "At present the bullish cycle is unstable; a short-term rebound may occur, but the path of least resistance remains lower."