Analysts See Crypto Winter Thawing: Bitcoin's $60K Floor Holds Key to Recovery
After months of relentless pressure, there are emerging signs that the cryptocurrency bear market may be running out of steam. Analysts at Compass Point Research & Trading published a note this week suggesting Bitcoin is carving out a critical support level, with a dramatic further sell-off now contingent on a parallel downturn in traditional equities.
"We are likely in the final stages of this cycle's correction," wrote lead analysts Ed Engel and Michael Donovan. "While volatility persists, the conditions for a catastrophic drop below key thresholds would now require a risk-off event spilling over from U.S. stock markets."
The firm's core scenario positions Bitcoin's bottoming range between $60,000 and $68,000—a zone historically fortified by the conviction of long-term investors. Data indicates that 7% of coins held for over six months were accumulated within this band, creating what analysts describe as "very strong structural support." Their base case points to a trough near $65,000.
Recent price action underscores the fragility of higher levels. Bitcoin's weekend plunge below $81,000 to around $74,500 tested the average cost basis for both the spot ETF ecosystem and the broader market. With over half of ETF assets now held at a loss, the $81,000-$83,000 range has flipped from support to a formidable resistance ceiling. "The ETF outflow story has introduced a new headwind," the report noted, referencing over $3 billion in net redemptions since mid-January.
Perhaps more concerning is the identified "air pocket" between $70,000 and $80,000. Here, minimal historical buying activity by long-term holders suggests scant support, leaving the door open for accelerated declines if selling pressure mounts.
Should the $60K-$68K fortress fall, the next major line of defense sits near $55,000, aligning with the all-historical-buyer average cost basis. However, Compass Point stresses that breaching this level would likely demand a perfect storm reminiscent of 2022: a simultaneous equity bear market and severe crypto-specific contagion.
Market Voices:
"Finally, some data-driven optimism. The $60K-$68K range has been a historical accumulation zone. If HODLers are buying here again, it's a strong signal the smart money sees value," said Arjun Patel, a portfolio manager at Cedar Point Capital.
"This is hopium. They're just moving the goalposts. First $80K was the floor, then $70K, now $60K. The 'equity bear market' caveat is a giant escape hatch for a flawed thesis," argued Maya Chen, independent crypto analyst and vocal critic.
"The linkage to traditional markets is the key takeaway. Crypto can't decouple yet. A stable S&P 500 is a prerequisite for any sustained Bitcoin recovery," noted David Fischer, professor of financial technology at Weston University.
"ETF flows are the new fundamental. Until we see consistent inflows return, resistance levels will be hard to break. The market is rebuilding patience," added Sarah Lim, head of research at Digital Horizon Advisors.