Bitcoin’s Struggles Continue

There are still a few hours left in the current trading day, but it appears that Bitcoin is on track to face its worst losing streak since 2018. February may mark its fifth consecutive month of declines, which is noteworthy.

This ongoing downturn reflects the longest losing streak since the bearish phase between 2018 and 2019. It follows what has already been the worst start for Bitcoin in its first 50 days of the year, with its value dropping more than 25% year-to-date. It’s actually heading toward a back-to-back decline in both January and February, which is a first.

Interestingly, the Bitcoin-to-gold ratio fell to 12.288 ounces this month, implying a staggering 70% downturn over the past 14 months.

February has turned out to be tough for Bitcoin, which recently endured its worst month since June 2022. The price plummeted around 20% during this period, reminiscent of the Terra Luna collapse that saw it drop by nearly a third. Currently, Bitcoin hovers around $64,000.

That said, some analysts suggest that equating the current circumstances to 2018 might be oversimplifying things.

Price Changes Amid a New Market Reality

Matty Greenspan, a senior market analyst at eToro and founder of Quantum Economics, pointed out that what we’re witnessing is significantly more complex than mere weakness in price. He argues that prices are undergoing adjustments due to a structural regime shift. While tariffs, ETF activities, and economic concerns may explain the timing of recent declines, he sees a deeper movement at play—a recalibration of market valuations for risk assets amid increasing uncertainty.

Bitcoin is now close to marking its fifth consecutive week of declines, a stretch that echoed the downturn from March to May 2022.

Geopolitical tensions have been influencing financial markets, increasing the US dollar and oil prices. This has tightened financial conditions, thereby weighing down risk assets.

But there’s something notable about this economic downturn: the disparity between Bitcoin and stock performance. U.S. stocks maintain resilience while Bitcoin faces a pronounced drop, showcasing unusual instability in the correlations of traditional risk assets.

Contradictory Perspectives

Jonathan Lundin, a senior market analyst at PrimeXBT, stated that Bitcoin currently lacks a clear narrative and is experiencing pressure from various angles. He cited macro pressures, including $3.8 billion in ETF outflows over the last five weeks, rising tariff tensions, and the Federal Reserve not indicating an imminent rate cut.

Whereas gold has gained significant traction as a safe-haven asset, Bitcoin has lagged behind. Gold has risen nearly 48% since September, while Bitcoin has dropped around 41% during the same period. Lundin believes this divergence illustrates that investors still classify Bitcoin as a risk-sensitive asset rather than a stable digital equivalent to gold.

The correlation metrics are erratic. According to Lundin, the 20-day correlation between Bitcoin and Nasdaq fluctuated dramatically, ranging from -0.68 to +0.72 from early to mid-February. “This inconsistency suggests weakness, not strength,” he mentioned.

In Greenspan’s view, the overarching narrative has not shifted since 2009; Bitcoin exists as a neutral alternative to a debt-based fiat system.

Patterns of Deviation

Greenspan added that breakdowns in correlations during transitional periods aren’t random—they signify an early reassessment. He posited that if Bitcoin begins trading more like a sovereign hedge while equities remain viewed as cyclical growth investments, this divergence could signal structural positives.

Despite the steep decline, Lundin advised caution against prematurely concluding that the correction phase has ended. He noted that Bitcoin is down 52% from its peak in October. “While that sounds substantial, previous bear markets often showed drawdowns of 80% or more. Realistically, we might be only halfway through this correction,” he noted.

Furthermore, the weekly Relative Strength Index (RSI) has hit a historic low for Bitcoin. Accumulator addresses have taken in approximately 372,000 BTC since late December, which typically signals a market bottom, yet this has happened in earlier declines with additional drops of 30% to 40% before establishing a firm low.

Still, Greenspan suggested that prevailing sentiment might already encapsulate much of the pessimistic outlook. “When overall sentiment turns negative despite solid long-term fundamentals, reversals can be quite sudden,” he remarked.

Lundin anticipates that any momentum in the meantime will persist until Bitcoin manages to reclaim the $68,000 to $72,000 range. He pointed to $60,000 as crucial support in the short term, with the 200-week moving average sitting just below at around $58,500.

“The narrative about the losing streak emphasizes a five-month stretch,” Greenspan concluded. “But the broader structural story spans decades.”