Bitcoin slipped to a two-week low of $78,000 yesterday, extending a pullback that has traders watching a familiar warning sign. The average realized profit margin for traders hit 17% — the highest since October 2025, shortly before a crash that wiped out over $19 billion in leveraged positions and sent Bitcoin from $126,000 to $60,000. That same 17% level, when paired with Bitcoin testing its 200-day moving average as resistance, signaled a local top in March 2022, according to analyst Ali Martinez.
Profit margins flash a warning
Martinez pointed out that the current setup mirrors that earlier period. Back then, profit margins at 17% while Bitcoin struggled against the 200-day MA preceded a sharp reversal. The parallel has traders questioning whether this month's rebound — a 38% jump from $60,000 in early February to nearly $83,000 within a week — is running out of steam. Bitcoin was trading around $78,000 as of yesterday, a level that still leaves it well above the February crash floor but far from the highs.
Short sellers stay active
Not everyone is betting on a recovery. Analyst Doctor Profit has been shorting Bitcoin from $120,000 and warns of a drop to $50,000 or lower if macro conditions worsen. He holds active short orders on 70% of his position, with shorts accumulated at $82,000, and has already closed some longs at $71,000 and $75,000. The aggressive positioning suggests he sees the current bounce as a selling opportunity rather than a trend change.
The case against a bottom
Rekt Capital laid out a statistical argument against calling a bottom. If Bitcoin has truly bottomed, he says, it would require the bear market to shorten to one-third of its usual duration, corrections to shallow by roughly 25% (historical max corrections have been around 10%), and the previous bull cycle to lengthen by over 200 days. He considers that combination “probabilistically unlikely.” In plain terms, the data suggests this pullback may have further to go before a sustainable low forms.
None of this guarantees where Bitcoin goes next — markets have a habit of breaking patterns. But with profit margins flashing red, short sellers piling in, and historical models pointing to more downside, the next few days will test whether the February recovery was a real turn or just a dead-cat bounce. No major catalysts are on the calendar this week, leaving price action to the charts and the macro mood.
