As the crypto market recovers from the latest pullback, Bitcoin (BTC) is trying to recover from a one-month low. Some analysts have warned that the correction has left the cryptocurrency in a “fragile position” similar to the start of the previous bear market.
Related reading
Bitcoin risks a correction like in 2022
On Sunday, Bitcoin saw an intraday drop of 3.6%, closing the day below its annual open for the first time. Since November, the flagship crypto has fluctuated between $86,000 and $93,500 weekly, failing to convert range resistance into support despite multiple attempts.
During the early January breakout, BTC climbed 11.5% from its 2026 opening price of $87,600, reaching a two-month high of $97,924 nearly two weeks ago. Since then, the cryptocurrency has erased all of its recent gains, dipping below this key area and ending the week at the base of its range.
Amid this crackdown, market observer Philarekt said confirmed that Bitcoin is repeating its 2022 playbook, highlighting the similarities between the leading crypto’s performance at the start of the last bear market and current price action.
As the chart shows, the cryptocurrency formed a bear flag pattern after the initial decline from the cycle top of $69,000. At the time, the cryptocurrency tested and rejected the 100-day moving average (MA), leading to a pullback to the lower limit of the pattern.
This was followed by a recovery towards the upper boundary of the formation, where the 200-day MA was located, and a rejection from this area, leading to a breakdown of the pattern and a 55% correction.
This time, Bitcoin has rejected the 100-day MA and is currently retesting the pattern’s support line. Based on this, he suggested that the flagship crypto could see another move towards the 200-day MA, located around the $100,000 mark, before “the real show” begins.
BTC price in precarious position
Meanwhile, Rekt Capital explained that Bitcoin was in a “particularly vulnerable position” as it needed to keep last week’s marginal closing price above the range high. “When Weekly Closes occur marginally above a key level, the subsequent retest becomes structurally precarious,” he explains.
In its analysis, the market watcher noted that Bitcoin saw a sharp rejection from the $98,000 region, where the 21- and 50-week Bull Market Exponential Moving Averages (EMAs) are located.
This coincided with the loss of a higher low structure that had built up similarly to 2021. “Losing that higher low is significant as it removes an important structural buffer that could have supported continued consolidation within the Weekly Range,” he claimed.
The rejection has shifted the focus to the strength of the $86,000 support and the character of the coming rebounds from this area. He warned that a smaller rebound from the lows would signal a weakening in demand, raising the likelihood of a slump below this support.
Related reading
Strong rejections that historically lead to downward continuation tend to occur later in the cycle toward the end of the first quarter or the beginning of the second quarter, Rekt Capital pointed out, but Bitcoin is already testing the lower end of its weekly range.
This adds “importance to the integrity of this support, as any premature disruption would represent a shift from that typical timing.” At this point, the weekly range remains crucial, “acting as the key decision point between a long-term relief structure and the risk of a deeper downtrend,” the analyst concluded.
Featured image from Unsplash.com, chart from TradingView.com