After months of consolidation, Bitcoin’s price has lost key support levels that could signal the start of a new bear market.

While on-chain analysts are sounding the alarm regarding the high-cost basis of new Bitcoin holders, technical analysts note Bitcoin’s low price next to its 200-day SMA.

Is The Bull Market Over?

The 200-day SMA, or “simple moving average,” is a trend line tracking Bitcoin’s average price over the previous 200 days.

Following Bitcoin’s surge to new all-time highs in March, Bitcoin’s price has remained mostly rangebound between $58,000 and $70,000, including a brief crash below to $50,000 in August. This consolidation period has given the 200-day SMA enough time to catch up to, and now surpass the market price.

Verified CryptoQuant author Adel Axel Jr. said the loss of this support “formally indicates a bearish sentiment.”

“Additionally, in recent days, increased leverage has been used on the top three exchanges,” he said over Twitter on Monday. “The nearest support level is the 365-day SMA ($50K).”

Axel Jr. didn’t indicate a bear market had officially started, however: on Sunday, he called Bitcoin’s five-month consolidation since March “healthy” involving no “massive stress-induced panic sells” while most early investors slowly took profits. “realized losses have exceeded profits, which often occurs at the end of a consolidation period,” he added.

Going forward, the analyst agreed that a “double test” near the $50,000 price level would be a “good scenario.”

Short Term Holders Now Underwater

Looking to on-chain data, lead Glassnode analyst James Check said Sunday that over 80% of short-term Bitcoin holdings are now underwater from when they were last bought. Short-term holders include anyone who bought their coins less than five months ago – a cohort of holders more likely to sell their coins when the market looks shaky.

“This is similar to 2018, 2019, and mid-2021 which signaled many investors were at risk of panicking and precipitating a bearish trend,” Check wrote.

That said, the actual magnitude of these losses is still quite shallow, meaning recent investors may not feel any panic quite yet. “Despite 80% of STH coins being in loss, the magnitude of Unrealised Loss is just 4% of the market cap,” Check continued.