Bitcoin (BTC) continues to struggle with recovery after failing to maintain momentum above key support levels. The crypto king’s inability to reclaim lost ground highlights growing structural weakness across the market. 

Recent data suggest that bearish sentiment is intensifying, as multiple on-chain and volatility metrics reveal deteriorating investor confidence.

The Supply Quantiles model indicates increasing bearishness in Bitcoin’s short-term outlook. This framework tracks cost-basis levels across quantiles—specifically the 0.95, 0.85, and 0.75 thresholds—representing portions of supply held at a loss. Bitcoin currently trades below the short-term holder cost basis of $113,100, which shows that the stress faced by recent buyers amid persistent market headwinds.

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More concerning, BTC remains under the 0.85 quantile at $108,600. Historically, losing this level has hinted at structural weakness and eventual broader corrections. Going forward, if the pattern holds, Bitcoin could retest the 0.75 quantile near $97,500. This alignment suggests that sellers may dominate the near term as market resilience continues to fade.

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Bitcoin’s macro momentum is showing cracks as volatility conditions shift. The 1-Month Volatility Risk Premium—the difference between implied and realized volatility—has turned negative for the first time in four months. This signals the end of a stable, low-volatility phase that previously favored passive income strategies for options sellers.

As volatility returns, short-gamma positions face increased pressure. This transition from complacency to reactivity suggests that larger swings may be ahead, potentially amplifying Bitcoin’s ongoing struggle to regain stability above key technical levels.

Bitcoin trades at $108,772 at press time, holding marginally above the $108,000 support. However, repeated failures to recover beyond this threshold highlight fragile market sentiment and persistent hesitation among institutional and retail participants alike. Moreover, the lack of strong buying activity suggests that confidence in a short-term rebound remains limited.

At the same time, if bearish momentum continues, Bitcoin’s price could break below $108,000 and test $105,585 or even $105,000. Consequently, such a decline would deepen investor losses and confirm near-term downside risks, thereby reinforcing the current corrective phase.

However, if Bitcoin maintains support at $108,000 and bounces, a relief rally toward $110,000 could follow. A sustained move above this resistance would pave the way for a climb toward $112,500, potentially invalidating the bearish outlook.