Bitcoin (BTC) has declined 22.5% over the past month. The coin briefly dipped to its lowest level in over a year last week before rebounding.

The pullback has intensified debate around historical cycles, technical indicators, and on-chain data that could signal where Bitcoin’s current bear market will finally bottom. As uncertainty rises, several analysts are now focusing on key price zones below $40,000.

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BeInCrypto Markets data showed that the largest cryptocurrency fell to $60,000 on February 6. Prices later recovered, with Bitcoin trading at $70,354 at press time, up 1.20% on the day.

A recent report from 10x Research suggested that the broader downtrend remains intact despite sentiment and technical indicators nearing extreme levels.

At the same time, flow data suggests investors remain cautious. Continued ETF withdrawals and rising stablecoin conversions point to limited appetite for aggressive dip-buying.

“Positioning dynamics suggest traders remain focused on deleveraging and position unwinds rather than on preparing for a typical snapback rally,” 10x Research wrote.

With uncertainty still dominating, the focus has shifted to identifying Bitcoin’s potential bottom. Many analysts believe more declines cannot be ruled out, with attention increasingly centered on price zones below $40,000.

Analyst Ardi examined Fibonacci retracement levels linked to past cycle bottoms. He noted that Bitcoin bottomed at the 78.6% Fibonacci mark during 2022’s bear market. This level currently sits near $39,176, hinting at further downside.

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Historical trends offer another clue. Analyst Nehal highlighted historical drawdown data showing that Bitcoin’s bear markets have become progressively less severe over time.

According to the analysis, Bitcoin declined by 93% in 2011, 86% in 2015, 84% in 2018, and 77% during the 2022 downturn. Based on this pattern, Nehal argued that each cycle’s drawdown has been roughly 7% smaller than the previous one.

Applying this framework to the current cycle, the analyst suggested that if Bitcoin peaked near $126,000, a drawdown of around 70% would imply a potential bottom near $38,000.

On-chain data also matters. Analyst Ted Pillows stated that the long-term holder realized price, which tracks the average cost for long-term investors, shows that cycle bottoms typically occur when prices drop 15% below this figure. 

With the current realized price at about $40,300, the model aims for a potential bottom near $34,500.

“I don’t personally think we could go this low,” he added.

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Moreover, another analyst sees Bitcoin fully bottoming at $30,000 by the end of 2026 before kicking off another aggressive multi-year rally.

Meanwhile, some market commentators argue that Bitcoin’s market bottom may already be in, challenging the widespread expectation that another deep bear market leg is still ahead.

A pseudonymous analyst stated that Bitcoin often bottoms near levels most investors least expect, pointing to previous cycles where bear market lows formed just below prior all-time highs. 

“Most people think Bitcoin still has ‘one more big crash’ left and that the ‘bear market’ is just getting started.  $40K. $35K. Some are even waiting for $20K again. And that belief alone is exactly why it probably won’t happen,” the post read.

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According to the analyst, the market structure has changed due to factors such as spot Bitcoin ETFs and increased institutional participation, which may be influencing how Bitcoin behaves during market downturns, making a move below $50,000 less likely.

“Why Bitcoin below $50K doesn’t make sense anymore…Would institutions that just: launched ETFs, onboarded billions in capital, educated shareholders, built infrastructure…allow Bitcoin to revisit levels that invalidate their thesis? Unlikely. Could we get volatility? Absolutely. Could we get scary pullbacks? Of course. But structurally? Sub-$50K Bitcoin would require something breaking – not just sentiment shifting,” the analyst remarked.

Analyst Darkfost also revealed that Bitcoin’s Sharpe ratio has entered a zone historically associated with the later stages of bear markets. 

“This type of dynamic is precisely what tends to appear near market turning zones. We are gradually approaching an area where this trend has historically reversed,” the analyst claimed.

Nonetheless, he cautioned that this does not signal the end of the bear market. Instead, it suggests that Bitcoin is approaching a phase where the risk-to-reward profile becomes increasingly extreme. 

The analyst added that this phase could last for several more months and that further price declines remain possible before a meaningful reversal takes place.