LONDON (IT BOLTWISE) – Bitcoin is under significant selling pressure and has hit $85,000. Recent market developments suggest that a bottom could be forming, signaling a possible recovery. Price stabilization at a psychologically important level could be a signal of an impending upswing.
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Bitcoin has seen significant selling pressure in recent days, falling to the $85,000 mark before staging a slight recovery. This development has shaken the confidence of market participants, but the intensity of capitulation among Bitcoin holders suggests that the market may be nearing a bottom. However, price stabilization at an important psychological level comes at the cost of widespread holder capitulation – a classic bottoming signal.
Macro momentum indicators show that the Bitcoin market’s risk assessments are shifting aggressively. The 25-delta skew has deepened into put territory across all maturities, suggesting traders are increasingly willing to pay for downside protection. The shift is particularly noticeable in longer-term options. Six-month puts have gained two volatility points in just a week, indicating structurally bearish positioning. These patterns typically occur near major cyclical bottom areas when markets overextend to the downside before equilibrium returns.
Realized losses among Bitcoin holders have risen to levels not seen since FTX collapsed. Short-term holders are driving the majority of this capitulation, indicating panic selling by buyers who entered near the highs. The magnitude and speed of these realized losses suggest that marginal demand has been completely exhausted. This type of aggressive deleveraging historically marks the final phase of a downturn. When short-term holders exit en masse, long-term holders typically step in and accumulation zones begin to form. This corresponds to classic ground behavior, where surrender precedes recovery.
Bitcoin is trading at $85,979 at the time of writing, holding above the $85,204 support level while defending the psychological level of $85,000. The convergence of capitulation, bearish skew and deep realized losses suggests that a market bottom is near or already forming. If this bottom is confirmed, Bitcoin could rally and break resistance at $86,822. A rise above this level could allow a rally to $89,800 and then to $91,521. Clearing these barriers would restore bullish sentiment and potentially push BTC towards $95,000 in the short term. However, if bearish pressure increases and macroeconomic conditions do not improve, Bitcoin could fall below $85,204. A fall below $82,503 would expose the price to a deeper fall towards $80,000, which would invalidate the bullish thesis and delay the recovery.
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