Bitcoin market sentiment has turned cautious following a recent market-wide correction. According to crypto intelligence platform Alphractal, the Sentiment Gauge score has fallen below 50, signaling a shift away from bullish conditions.
The sentiment change comes after a significant wave of profit-taking. Data from Santiment showed that $1.03 billion in profits were realized by Bitcoin holders, marking the second-largest wave of profit-taking in 2026. Alongside this profit realization, evidence suggests demand is also weakening.
Key Price Levels and Resistance
With weakened demand and shifting sentiment, analysts expect difficulty for Bitcoin to break above the $84,000 supply zone. The liquidation heatmap identifies the $83,600-$85,000 area as a magnetic zone that could pull prices higher. However, without spot demand, a move into this liquidity cluster could trigger a short squeeze before further corrections below $80,000.
The $80,500 level represents the invested capital cost basis—the average purchase price weighted by volume. This metric marks where investors are on average between profit and loss. Bitcoin prices have oscillated around this level over the past six weeks, a pattern similar to late 2025 and early 2026.
A Signal Suggesting a Local Bottom
Despite near-term headwinds, one technical indicator offers optimism. Analyst Joao Wedson highlighted that whenever Bitcoin's long/short ratio crosses above the altcoin market's long/short ratio, Bitcoin price declines have tended to stop temporarily. Sometimes a positive price reaction follows.
According to the analysis, such a crossover occurred on October 8th, suggesting a possible local market bottom.
Path Forward
For sentiment to shift bullishly again, Bitcoin needs a convincing move back above $85,000 supported by steady demand through onchain activity and ETF flows. Until then, the $80,500 support level remains critical to maintaining the short-term bullish scenario.
