Bitcoin Tests $90K Support as Bearish Momentum Persists

Bitcoin’s price action has extended its decline into the crucial $90K-$92K demand block, completing a full sweep of the October liquidity pocket that market participants have been closely monitoring. The asset is currently interacting with the lower half of a multi-week Fair Value Gap, an area where previous macro re-accumulation phases have historically formed. This technical positioning suggests Bitcoin is approaching a potential inflection point, though current momentum remains decisively bearish in the short term.

The broader technical picture reveals continued pressure on buyers, with both the 100-day and 200-day moving averages sloping downward above the current price. The most recent breakdown below $96K produced no meaningful bullish reaction, indicating that sellers continue to dominate market dynamics. However, what’s becoming increasingly notable is the growing separation between price and its mean trend, with the RSI reaching deeply oversold historical levels that match conditions seen during mid-cycle retracements in April and August.

For Bitcoin to establish any meaningful recovery, the market must reclaim the $98K-$100K region, which would serve as confirmation of renewed buyer strength. Failure to achieve this keeps the door open for further declines toward the lower demand zone near $85K. The 4-hour chart shows Bitcoin testing the $90K-$92K support box for the second time, with reactions remaining weak, though the compression of lower highs suggests the downtrend may be approaching its later stages.

Beyond price action, on-chain metrics reveal Bitcoin is experiencing one of the most intense short-term capitulation phases of this current cycle. The Short-Term Holder SOPR (Spent Output Profit Ratio) has dropped sharply toward 0.97, confirming that short-term holders are now realizing losses on a persistent basis. This metric has remained below the critical 1.0 threshold for several weeks, forming a clear capitulation band that typically emerges not at the beginning of corrections but near their later stages.

Historically, such periods represent fear-driven liquidations rather than informed long-term distribution. This behavior tends to occur when weak hands are flushed out and stronger holders begin absorbing supply at discounted prices. While this capitulation doesn’t guarantee an immediate price reversal, it reflects an important structural shift in market dynamics. The ongoing loss-taking by short-term investors resets cost bases and clears out speculative positioning, potentially allowing the market to transition toward a healthier foundation for the next macro move.

The key signal to watch for accumulation confirmation would be price stabilization above the $89K-$92K zone while SOPR remains suppressed but begins curling upward. This would indicate that capitulation has reached exhaustion and that accumulation is underway. However, a sustained breakdown of this critical support zone would open the path toward a deeper sentiment reset before any meaningful recovery can develop.

The current market structure presents a delicate balance between bearish momentum and potential accumulation opportunities. If buyers manage to defend the $89K-$92K band, this zone could form the base of a multi-week consolidation period, potentially marking a higher-timeframe accumulation zone before the next structural reversal. The clustering of lows within this region suggests that buy orders may be quietly absorbing supply, a common feature of early accumulation phases even when price volatility persists.

On lower timeframes, Bitcoin continues to move within a bearish formation, with each lower high forming closer to the support boundary. A clean bullish reversal above $96K would indicate a shift in short-term momentum, allowing a corrective rally toward the unfilled inefficiency at $102K. Conversely, if sellers maintain control, a deeper sweep of the $88K liquidity layer becomes increasingly likely. The structure remains vulnerable, but the combination of deeply oversold technical conditions and on-chain capitulation metrics suggests the market may be approaching a significant turning point.