In the cryptocurrency market, the price movement of Bitcoin has begun to resemble behavior observed in the final stages of previous bear markets. According to crypto analyst Murphy, Bitcoin has struggled to hold above the $67,900 mark, a significant level of technical resistance, for the past two months.
Murphy noted that this level is particularly important for short-term investors. According to the analyst, the $67,900 level represents the average cost basis for investors who have held Bitcoin for less than three months. Therefore, the price's inability to break through this level indicates that the behavior of short-term investors is still putting pressure on the market.
The analyst stated that in the late stages of a bear market, the activity of short-term investors typically decreases, leading to a flattening of the average cost curve. According to Murphy, a similar pattern is being observed in the current cycle. As Bitcoin remains within a certain price range, the changes in investor cost basis are also quite limited.
Murphy also drew attention to the final phases of the 2018 and 2022 bear markets. He noted that in both cycles, similar price behavior persisted for approximately three months, after which major market events triggered sharp price swings. In 2018, the Bitcoin Cash hash war, and in 2022, the collapse of the FTX exchange, created high market volatility.
Murphy argued that current prospects point to a similar phase, stating that uncertainty may persist until Bitcoin can break through its critical resistance level. According to the analyst, the market is currently in a sensitive period where volatility could rapidly increase in either direction in the event of significant external events. Therefore, investors should closely monitor both macroeconomic events and industry-specific risks.
*This is not investment advice.
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