On-Chain Signals Reveal: Bitcoin May Be Closer to a Bottom Than Expected, Market Sentiment Underestimated

Bitcoin currently sits at one of the most pivotal technical positions in this cycle. Above, millions of short-term holders facing losses have created a formidable resistance barrier. Below, the cost basis of long-term holders provides solid support. As of April 13, 2026, Gate market data shows Bitcoin trading at $70,700, with a market capitalization around $1.33 trillion and a market dominance of 55.27%. This price sits squarely in the sensitive zone between those support and resistance levels.

On the surface, since reaching its all-time high near $126,000 in October 2025, Bitcoin has retraced about 43%. Market sentiment has lingered in the "Extreme Fear" zone for over 20 days. Yet beneath this frosty sentiment, on-chain data is signaling something most participants may overlook—a structural bottom for this correction could be closer than many expect.

Price Enters Pressure Zone: Four Cost Baselines Reveal Critical Levels

Glassnode’s latest risk indicator chart overlays four key on-chain price models onto Bitcoin’s spot price, clearly illustrating where the market stands relative to the cost basis of different investor groups.

Risk Indicator, Source: Glassnode

Realized Price—Approximately $54,000

This represents the average on-chain cost basis for all Bitcoin across the network. With the current price above this level, the average holder remains in profit. Historically, realized price acts as the fundamental long-term support. In the 2022 bear market, price dropped below realized price and quickly formed the cycle’s ultimate bottom. Today, there’s still about a 23% buffer above realized price, which is a structurally positive signal.

True Market Mean—Approximately $78,000 to $82,000

The true market mean refines realized price by excluding long-dormant coins and weighting by actual economic activity, providing a more accurate reflection of "fair value." The current spot price is below this level, indicating a significant portion of active market participants are holding unrealized losses.

Active Investor Mean—Approximately $88,000

This metric measures the average cost basis of investors actively trading in the market. A price well below this level means active investors are experiencing notable unrealized losses, and this threshold will serve as a major resistance during any rebound.

Short-Term Holder Cost Basis—Approximately $81,000 to $84,000

Short-term holders are defined as those who have held Bitcoin for less than 155 days. The current price is well below their average cost basis, meaning most recent entrants are underwater. According to CryptoQuant, short-term holders are now sitting on an average unrealized loss of about 19.4%. Historically, this situation both fuels continued selling pressure and sets the stage for capitulation and bottom formation.

At $70,700, Bitcoin trades just above realized price but below the other three key cost baselines. This places Bitcoin in a historically validated "pressure zone"—neither the deep bear scenario of 2022 when price fell below realized price, nor the strong bull phase of a rally, but rather a classic mid-cycle correction and bottoming stage.

Technical Indicators: Bearish Momentum Fades, Bull-Bear Inflection Point Nears

On-chain cost baselines define the market’s structural framework, while technical indicators offer real-time insight into momentum and potential trend shifts.

Weekly Chart: Oversold Signals Accumulating

On the weekly chart, Bitcoin’s Relative Strength Index (RSI) currently reads 33.59, approaching the oversold threshold below 30. Back in February 2026, weekly RSI briefly dipped into oversold territory before rebounding. During the 2022 bear market, RSI stayed oversold for several weeks. The current reading hasn’t reached such extremes, suggesting the market is still some distance from a typical bear market bottom, but downside momentum is steadily weakening.

BTC/USDT Weekly Chart, Source: Tradingview

The weekly MACD indicator is deep in negative territory but is gradually approaching its first bullish crossover. The last weekly MACD golden cross occurred in May 2025, sparking a strong rally. However, it’s important to note that during the 2022 bear market, even a MACD golden cross didn’t immediately reverse the downtrend. Thus, a single crossover signal should be interpreted alongside other indicators.

Daily Chart: Fragile Rebound Attempts

The daily chart presents a more complex picture. The previous support zone around $73,000 to $74,000—which corresponded to the March 2024 all-time high—has recently been breached and now acts as resistance. Bulls need to reclaim this area to confirm a trend reversal.

Daily RSI, after two oversold shocks in December 2025 and February 2026, has recovered to the neutral 40–50 range. Panic selling has subsided for now, but bullish momentum hasn’t been firmly established. If daily RSI breaks above 60, it would signal a key confirmation of trend reversal.

BTC/USDT Daily Chart, Source: Tradingview

The daily MACD has completed a fragile bullish crossover, with the histogram oscillating narrowly around the zero line. This reflects a market in consolidation rather than a clear directional move. Whether this crossover holds and the histogram expands in positive territory will determine if buyers can sustain a rally.

Dual Squeeze from Market Sentiment and Macro Environment

While analyzing on-chain data and technical indicators, it’s crucial not to overlook the macro and sentiment backdrop facing the market.

Fear Index Signals Extreme Levels

As of mid-April, the Crypto Fear & Greed Index has remained in the "Extreme Fear" zone (below 20) for over 20 consecutive days—the longest such streak in 2026. Notably, while this indicator has stayed deeply depressed, Bitcoin’s price has already broken above $72,000. This rare divergence between negative sentiment and price recovery is striking. Historically, prolonged low readings in the Fear & Greed Index often mark the bottom zone of the market.

Macro: Dual Pressure from Inflation and Geopolitics

On the macro front, US CPI rose 3.3% year-over-year and 0.9% month-over-month in March. Although inflation is cooling at the margins, it remains elevated. The probability that the Fed will keep rates unchanged in April is as high as 98.4%, with the rate-cut window continually pushed back. This high real rate environment weighs on risk asset valuations.

Meanwhile, geopolitical events like the breakdown of US-Iran talks have brought intermittent volatility to Bitcoin. On April 12, Bitcoin briefly touched $73,800 before pulling back. With geopolitical risk and macro uncertainty, short-term price swings remain intense.

Scenario Analysis: Two Paths, One Watershed

Considering on-chain cost baselines, technical indicator status, market sentiment, and macro context, Bitcoin faces two clear evolutionary paths. The following logical projections are based on current data structures and do not constitute definite price forecasts.

Scenario 1: $69,000 Support Holds, Mid-Cycle Bottom Forms

In this scenario, $69,000 (the previous cycle’s all-time high) acts as a key support and is confirmed. Specific confirmation signals include: daily RSI breaks above 60, confirming renewed bullish momentum; daily MACD histogram expands in positive territory; price reclaims the $73,000–$74,000 range (former support turned resistance), marking the first confirmation of trend reversal. If these conditions are met, price could advance to test the $80,000–$84,000 cluster of cost baselines. This zone aligns with the true market mean and short-term holder cost basis. Once reclaimed, a large number of short-term holders would shift from losses to gains, removing the main source of selling pressure and significantly boosting the credibility of a trend reversal.

Scenario 2: $69,000 Fails, Correction Deepens Toward Long-Term Support

If $69,000 is decisively breached on a weekly close, it would serve as a major bearish confirmation. Trigger conditions include: weekly RSI falls below 30 and remains depressed, echoing 2022 bear market patterns; daily MACD bullish crossover fails, with indicator lines dropping back below the zero axis. Under this path, price would first test the demand zone near $65,000. If that fails, the next target is around $54,000—the realized price. Historically, areas near realized price often mark the ultimate bear market bottom and attract concentrated accumulation by long-term investors.

The fate of $69,000 is the core observation point for Bitcoin’s mid-cycle direction. Holding this level strengthens the bullish case; a weekly close below it requires reassessing downside potential.

Conclusion

Bitcoin’s current market structure exhibits a classic "pressure zone" profile—spot price trapped between long-term support and multiple layers of short-term resistance, with bulls and bears locked in intense battle. On-chain cost baselines show the realized price at $54,000 provides a solid safety net, while the $81,000–$88,000 range forms a cluster of short- and mid-term resistance that must be overcome. Technically, bearish momentum is fading, but bullish signals have yet to resonate convincingly.

Against a backdrop of ongoing macro uncertainty and geopolitical turbulence, the importance of the $69,000 dividing line is magnified. Historical experience suggests that the most pessimistic sentiment often coincides with price bottoms, while structural on-chain features—price holding above the network’s average cost, long-term holders continuing to accumulate—offer a rational reference point for this stage.

For analysts tracking on-chain signals, the key variables to monitor now are: the effectiveness of $69,000 support, confirmation signals from daily momentum indicators, and the turnover dynamics near the short-term holder cost basis. These factors will collectively determine the ultimate direction of Bitcoin’s current correction.