Analysts warn that several subtle market signals suggest Bitcoin may be approaching the start of a bear market in November. 

Selling pressure from long-term holders, weakening correlation behavior with tech stocks, and Bitcoin’s failure to hold key technical levels are all indicating a fading of bullish momentum. These trends indicate growing downside risk even amid supportive macro conditions.

Early Warning Signs

Market analysts are increasingly concerned that Bitcoin’s broader uptrend may be weakening. One of the clearest warning signs is coming from long-term holders.

Since mid-year, veteran investors and early whales have been steadily selling their positions, a trend that has accelerated in the past year.

This shift has triggered a danger signal on the Coin Days Destroyed (CDD) indicator. The metric shows when older, inactive coins suddenly move or get sold.

This month, negative CDD readings have coincided with ETF outflows, resulting in a combination of weak demand and rising supply.

“Long-term holders might be distributing into weakness, not strength—a potential bearish signal,” community analyst Maartunn said in a social media post.

While selling pressure from long-term holders is significant, a broader concern arises when examining Bitcoin’s behavior in relation to traditional financial markets.

A Weak Response to Bullish Catalysts

Wintermute data shows that Bitcoin still moves closely with the Nasdaq-100, maintaining a correlation near 0.8.

Yet this relationship is becoming asymmetric. When the Nasdaq drops, Bitcoin tends to fall more sharply. When the Nasdaq rallies, Bitcoin reacts only mildly.

This imbalance reflects behavior observed in earlier bearish periods, such as the 2022 crypto winter. It suggests that investors treat Bitcoin as a high-risk asset during downturns but are hesitant to reward it when conditions improve.

“Historically, this kind of negative asymmetry doesn’t appear near tops but rather shows up near bottoms. When BTC falls harder on bad equity days than it rises on good ones, it usually signals exhaustion, not strength,” Wintermute’s Jasper de Maere said in a blog post.

Adding to this caution is Bitcoin’s recent failure to rebound from its 50-week moving average. This is the first time since the previous cycle bottom that BTC has not bounced from that long-term support. 

In earlier stages of the cycle, Bitcoin recovered from this level three times, each recovery triggering a strong rally. The latest failure to reclaim the 50-week MA suggests that a potential trend reversal may be forming.

Although not conclusive on their own, these signals become more notable because Bitcoin is declining despite government stimulus and despite Federal Reserve rate cuts. Normally, both developments act as strong bullish catalysts. 

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