Are We in a Bull Market or Bear Market Right Now? (January 2025)
We analyze the current state of the crypto market, concluding that it is in a late-cycle bear market phase.
AI summary
Crypto markets don’t flip from bull to bear overnight. Instead, they slide along a spectrum of trend, liquidity, and sentiment. Currently, the most precise reading is that we are in a late-cycle downtrend/bear phase correction within a broader, multi-year uptrend.
It reflects what the data is showing: prices are materially off their highs, key long-term indicators have turned bearish, and sentiment has cooled, even though long-term adoption and institutional positioning remain active.
TL;DR
Right now, crypto looks more like a bear market than a bull market
Bitcoin fell sharply from its recent peak above $123,000 to the high $80,000s by early January.
A widely watched long-term signal (the 200-day trend / moving average structure) has turned bearish, prompting multiple analysts to call the bull cycle “over” from a technical standpoint.
Market sentiment has cooled substantially
However, this does not necessarily imply a crypto winter similar to 2022. Instead, it appears to be a cycle reset following a period of rapid growth.
What defines a bull vs. bear market in crypto?
A bull market has a clear upward structure that holds over time. On higher timeframes, such as the weekly chart, price tends to form higher highs and higher lows, meaning buyers consistently step in at stronger levels, and momentum builds instead of fading.
Another hallmark is that prices trade above long-term trend measures, such as the 200-day moving average, and that trend line often slopes upward. This suggests the market isn’t just rallying short-term, but sustaining strength as the broader trend supports continued gains.
During bull markets, risk appetite expands, often manifesting as stronger performance from higher-risk assets. In the crypto space, this typically means that altcoins outperform Bitcoin, leverage rises across derivatives markets, and capital flows more aggressively into speculative investments as confidence grows.
Finally, sentiment usually stays elevated. Indicators like Fear & Greed tend to sit mostly in Greed territory, reflecting optimism, higher participation, and a general willingness to chase upside.
Bear market (common traits)
A bear market typically shows a weakening structure that persists over time. Instead of building upward, prices tend to form lower highs and lower lows, which means each rebound fails sooner than the last, and sellers gradually take control of the trend.
Another major sign is that price spends extended periods below long-term trend measures, such as the 200-day moving average, and those trend lines often flatten or slope downward. This reflects broad weakness, where even strong short-term rallies struggle to shift the overall direction.
In bear phases, liquidity tightens, making it harder for prices to sustain moves upward. That’s why bear markets are known for “relief rallies” that look promising at first but eventually get sold off as traders and investors use the bounce to exit positions or reduce risk.
Sentiment also changes dramatically. Instead of optimism, the market becomes dominated by caution and pessimism, and fear-based indicators often swing into “Fear” or “Extreme Fear” and stay there. Participation drops, conviction weakens, and many investors shift from chasing upside to simply protecting capital.
Right now, the bear is winning.
Bear market (December 2025)
Bitcoin peaked above $123,000 and dropped into the high $80,000s by year-end, a drawdown large enough to shift market structure and psychology.
Bitcoin’s 200-day trend has flipped bearish, and a “death cross” (50-day moving average below 200-day) was noted as part of the weakening structure. In addition, the Fear and Greed Index is currently in the extreme fear range.
Levels & signals to watch (January 2026)
Is BTC reclaiming and holding key resistance zones (e.g., low $90Ks cited as a structural battle area)?
Is the 200-day trend turning back up or flattening?
Is the total cryptocurrency market cap stabilizing or still in decline?
Fear or Extreme Fear that persists can signal capitulation
A quick jump back to Greed without structure improvement can signal a bull trap
If we are in a bear phase:
Expect high volatility and sharp rallies that fail
Prioritize risk management over moonshots.
Be careful with leverage and illiquid altcoins.
Zoom out: bear phases often create the best long-term entries
