Bitcoin (BTC) continues to trade in bearish territory, extending its recent losses, with the $80,000 level emerging as a key support that could prevent further declines amid an alarming capital outflow.
Currently, Bitcoin is at a three-month low, trading below $90,000, as investors focus on identifying a potential price bottom before any rebound.
Finbold consulted xAI’s latest artificial intelligence (AI) model, Grok 3, to assess when Bitcoin might find a floor. According to the AI model, Bitcoin’s correction is nearing its final stages, with a potential bottom forming in the coming weeks.
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The downturn follows Bitcoin’s all-time high of $108,000 in late January. Grok 3 noted that historically, BTC experiences corrections of 20% to 40% after parabolic rallies, making the current pullback a typical occurrence.
In this context, the model highlighted key psychological and historical support levels, identifying $80,000 as a critical floor. In a worst-case scenario, Bitcoin could dip to the $74,000 and $78,000 range.
When will BTC bottom?
Bitcoin’s post-halving cycle also influenced Grok 3’s forecast. Following the April 2024 halving, historical trends suggest that bull markets typically peak 12 to 18 months later, implying a potential top between April and October 2025.
Given this pattern, Grok 3 suggested the current decline is a mid-cycle correction rather than the start of a prolonged bear market.
Based on past cycles, the AI model estimates Bitcoin could bottom out between mid-March and early April, likely stabilizing in the $78,000 and $82,000 range before consolidating.
However, external factors such as regulatory changes, institutional demand, and macroeconomic conditions could influence this timeline.
A similar bottom range has been set by cryptocurrency analyst CrypNuevo, who noted that the asset is likely to rebound in March, as per a Finbold report.
Bitcoin in a macro trend shift
Indeed, technical indicators suggest Bitcoin is flashing signs of a significant macro trend shift based on the Bull-Bear Market Cycle Indicator.
According to data by CryptoQuant, shared by on-chain cryptocurrency analyst Ali Martinez on March 2, Bitcoin has entered an extreme bearish phase, with the indicator dipping below zero, a sign of deeper corrections.
The data indicates that Bitcoin’s price has been declining, with the indicator transitioning from early bull and bear phases to extreme bear. This implies that BTC is experiencing a notable downturn, potentially testing lower support levels.
The indicator tracks Bitcoin’s 365-day and 30-day moving averages (MA) to determine broader market trends. When the value moves below zero, the market enters a prolonged bearish phase or the late stages of a correction before a recovery begins.
Bitcoin on the verge of a rebound
Another CryptoQuant data set suggests Bitcoin could be on the verge of a rebound. Its on-chain trader realized loss margin has hit -14%, surpassing the typical -12% threshold that has marked market bottoms before a recovery.
Bitcoin’s realized price is $99,250, while its current price hovers around $85,000, leaving many short-term holders underwater. However, past data shows that such capitulation often precedes strong rebounds as sellers exhaust themselves and demand picks up.
If history repeats, Bitcoin could soon stage a sharp reversal, potentially retesting previous highs. Traders will be watching closely for confirmation of a recovery.
Meanwhile, on-chain data also hint at what to expect from Bitcoin. Specifically, Bitcoin’s active addresses have hit a three-month high, signaling a possible market capitulation and price rebound.
According to Glassnode data, active addresses surged past 912,300 on February 28, a level last seen on December 16, 2024, when BTC traded near $105,000.
In this case, spikes in on-chain activity often mark market tops and bottoms, driven by panic sellers and opportunistic buyers. While not a definitive reversal signal, the surge suggests Bitcoin may be at a pivotal moment, with a rebound as the next possible move.
Bitcoin price analysis
As of press time, Bitcoin was trading at $85,867, gaining 1% in the past 24 hours. However, on the weekly timeframe, the digital currency has plunged over 10%.
As things stand, Bitcoin’s $80,000 support remains critical to preventing further declines, while $90,000 serves as a key resistance. A break below could trigger more downside, whereas reclaiming $90,000 may confirm a rebound.
Featured image via Shutterstock
