Bitcoin sentiment turns cautious – Yet ONE signal hints at BTC’s local bottom
The crypto market sentiment was no longer bullish. Weak demand and an overhead magnetic zone could lead to a short squeeze.
The Bitcoin [BTC] bullish structure AMBCrypto reported on recently was still in play, but the market sentiment could be shifting. In a post on X, crypto intelligence platform Alphractal observed that the market sentiment was no longer bullish.
The Sentiment Gauge score has fallen below 50 after the market-wide correction earlier this month. Earlier, Santiment data had shown that $1.03 billion in profits were realized by Bitcoin holders.
The 2nd-largest wave of profit-taking in 2026 contributed to the shifting sentiment, and there was evidence that demand was also weakening.
The shift in sentiment and weakened demand could make it difficult for Bitcoin to break above the $84k supply zone overhead. The liquidation heatmap showed the $83.6k-$85k area as a magnetic zone that can pull prices higher.
Without spot demand, a move into this liquidity cluster could become a short squeeze before Bitcoin continues to correct further and fall below $80k.
The key onchain support level Bitcoin bulls should monitor
The $80.5k represented the invested capital cost basis level. Bitcoin prices have oscillated around this level over the past six weeks. It was a pattern similar to the one exhibited in late 2025 and early 2026.
Crypto analyst Darkfost pointed out that the invested capital cost basis marks the line where investors, on average, are on the line between profit and loss.
The realized price only uses the purchase price, while the metric above also takes into account the volume of capital invested. At the time of writing, the $80.5k level is a key support to watch.
A sign the local market bottom is in
There was a silver lining to the seeming short-term doom and calls for caution. Analyst Joao Wedson highlighted a local market bottom signal in a post on X.
In recent months, whenever the Bitcoin long/short ratio crossed over above the altcoin market long/short ratio, the Bitcoin price decline tends to stop for a while. Sometimes, a positive price reaction also ensues.
Therefore, the $80.5k line can be considered the one keeping the bullish short-term scenario alive right now. Meanwhile, a convincing price move back above $85k, with steady demand (onchain and ETF flows, for example), is needed to shift market sentiment bullishly once more.
Final Summary
- The crypto market sentiment was no longer bullish. Weak demand and an overhead magnetic zone could lead to a short squeeze and a deeper correction afterwards.
- The Bitcoin long/short ratio gave a clue on the 8th of October that a local market bottom could be in, when it surpassed the altcoin long/short ratio.
