Bitcoin, $55,000 Final Line of Defense… Last Bastion Before On-Chain Capitulation

▲ Bitcoin (BTC), decline, crypto fear / ChatGPT-generated image ©

Whether Bitcoin (BTC) can defend the $55,000 level has emerged as the final inflection point determining a medium- to long-term shift into a bearish trend.

According to cryptocurrency outlet Bitcoinist on February 14 (local time), Bitcoin has failed to reclaim $70,000 and continues to show a defensive price pattern. Analysis by Axel Adler indicates that Bitcoin has fallen about 47%, from approximately $125,000 last October to around $66,400 recently. This is viewed not as a short-term correction but as a phase of sustained structural pressure.

The market’s key variables at present are on-chain indicators: the realized price and the average purchase price of long-term holders (LTH). The realized price is declining by about 0.55% on a weekly basis, while the cost basis of long-term holders is rising by roughly 0.96%. If this trend continues, the two indicators could converge within the next quarter in the range between $43,000 and $51,000. This suggests that the long-term structural support zone is rapidly compressing.

The realized price currently stands near $55,000, serving as the primary line of defense. Meanwhile, the average cost basis for long-term holders is estimated at approximately $43,223 on a quarterly basis. The support gap between the two indicators is expected to narrow from about $16,700 to less than $8,000. A break below this range could increase the likelihood of entering a deeper bearish phase, analysts say.

Technical factors also remain burdensome. Bitcoin has clearly fallen below the psychological support level of $70,000 and is trading beneath short-term moving averages, reinforcing the downward trend. Since peaking around $120,000, it has continued to form lower highs alongside accelerating downside momentum. During the recent sharp decline, surging trading volume was accompanied by signs of forced liquidations and panic selling.

However, if prices consolidate at current levels and volatility contracts, the possibility of forming a short-term stabilization range remains. Conversely, if Bitcoin fails to quickly reclaim $70,000, market focus is likely to shift to the $55,000 level and further to the $43,000–$51,000 support zone. Bitcoin’s trajectory now hinges on whether these structural defense lines can hold.

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