Bitcoin (BTC) is at a critical stage in the market cycle, with some factors suggesting that prices may continue to fall while others suggest that prices may have bottomed.

Currently, Bitcoin is trading at $57,700, rebounding from last week's low of $53,600. However, Bitcoin remains in a technical downtrend from the record high of $73,800 in March, forming lower highs of $71,300 and $63,900.

According to CryptoQuant, the Profit and Loss Index is hovering near its 365-day moving average, which suggests a major correction or continued bear market may be coming. Previously, downward crossovers in this index were a precursor to deep declines in May and November 2021.

CryptoQuant's Bitcoin Bull and Bear Cycle Indicator is also approaching a key level, suggesting a possible entry into a bear market.

Separately, the lack of growth in Tether's (USDT) market capitalization also shows that historical recoveries have often relied on an increase in stablecoin liquidity, which CryptoQuant added could make a rebound difficult.

However, Bitcoin’s largest holders have increased their holdings during the recent decline, with holdings increasing by 6.3% over the past month, the fastest pace of growth since April 2023.

In addition, Germany’s massive sale of seized Bitcoin appears to be coming to an end, with the German government’s wallets nearly empty since 50,000 BTC was seized from Movie2k in January.

Other bullish factors, such as the U.S. approval of an Ethereum ETF and the continued growth of U.S. stock indices, which have historically correlated with Bitcoin, suggest that Bitcoin could continue to rise in 2024 despite signs of short-term weakness. #内容挖矿