Bitcoin Faces Potential Drop to $68,000 as Onchain Data Mirrors 2022 Bear Market

Bitcoin's recent recovery has stalled near $93,000, triggering concerns among analysts who see troubling parallels to the cryptocurrency's 2022 bear market. Multiple data points suggest the digital asset could be entering a deeper correction phase. At the time of writing, Bitcoin is trading at $92,670, with technical and onchain indicators painting a bearish picture for the weeks ahead. Bitcoin price chart, Source: CoinMarketCap Market Structure Echoes 2022 Downturn Onchain analytics firm Glassnode has identified striking similarities between current market conditions and the period that preceded Bitcoin's prolonged bear market in 2022. The cryptocurrency has declined toward its True Market Mean, a critical support level sitting at $81,500. This metric represents the average acquisition price of all active coins in circulation, excluding those held by miners. According to Glassnode's latest analysis, this threshold typically separates standard corrections from severe bear markets. The data provider noted that Bitcoin's broader market structure now mirrors dynamics observed during the first quarter of 2022. During that period, the cryptocurrency maintained positions above the True Market Mean from late January through early May before breaking down. The subsequent collapse saw prices plunge 61% to $15,500 by November 2022. Source: Glassnode Additional evidence comes from the Supply Quantiles Cost Basis model, which tracks entry prices for significant coin holdings. Bitcoin has traded below the 0.75 quantile since mid-November, leaving more than 25% of the total supply underwater. The 0.75 quantile currently stands at $96,100. Glassnode warned that the market remains in a fragile state, balanced between potential capitulation from recent buyers and possible seller exhaustion. The firm emphasized that Bitcoin needs to reclaim the 0.85 quantile around $106,200 as support to stabilize the current structure. Bear Flag Pattern Points to $68,000 Target Technical analysis reinforces the bearish outlook. Bitcoin faces strong resistance at $93,000, which aligns with the yearly opening price and the upper boundary of a developing bear flag pattern. Bear flags typically form during downtrends and signal continuation of the prevailing bearish momentum. The pattern projects a measured move target of $68,150 if Bitcoin closes below the flag's lower boundary at $91,000. This level corresponds to the previous all-time high established in 2021. A move to $68,000 would represent a 27% decline from current levels. The relative strength index sits at 40 on the two-day chart, indicating weak momentum that favors sellers. CryptoQuant's Bull Score Index offers further confirmation of deteriorating market conditions. The metric has remained below 40 since October, currently registering in the 0-20 range. These readings match levels seen in January 2022, just before the extended bear market began. Source: CryptoQuant The bearish scenario would be invalidated if Bitcoin manages to break above $96,000 with strong volume support. A positive Coinbase Premium would need to accompany such a move to confirm genuine buying pressure from institutional participants.