Bitcoin Breaks Down: On-Chain Weakness + $66K Support Fail Signals Deeper Correction Ahead

Recent on-chain indicators show a gloomy scene for Bitcoin as network engagement keeps falling off significantly. Active addresses have dropped approximately 30–42% from recent highs or multi-year averages, with new address creation down likewise (up to 47% below 5-year norms), thereby showing distinct indications of retail tiredness and diminishing user engagement. Adding to this, the actual profit/loss ratio swings in the 1–2 range, pointing to an early bear phase with higher realised losses, and short-term holders' MVRV hovers at a distressed 0.72 level (deeply underwater). Heavy ETF outflows estimated at $6-8 billion have further fueled capitulation selling, accelerating the price breakdown below the critical $66,650 support level to around $64,600 as of February 24, 2026 (4:45 PM IST), with spot prices dipping toward $63,000-$64,000 in live trading.

Whales have shown aggressive counter-moves despite the general weakness, amassing considerably in recent weeks—including a tremendous 66,940 BTC (~$4.6B) single-day burst earlier in February and a net increase of more than 200,000 BTC from December lows. This buildup has countered strong miner selling pressure that grew following the support break, although long-term holders remain mostly unshaken and fixed. Though it hasn't stopped the flood of retail and ETF-driven exits, the whale purchasing gives a possible basis during the economic downturn.

Having decisively broken below $66,650, downside dangers now aim for $63,000 and $60,000 as instant supports with $57,800 in play if bearish momentum—driven by macroeconomic elements like tariffs and liquidations—persists. Extreme fear levels on sentiment indicators might set the stage for a reversal if trading volume rebounds and whale support holds firm, but current signals indicate continued pressure and a possible deeper correction before any meaningful bottom forms.