Bitcoin Strategy & Market Analysis - W1 February 2026

Bitcoin Strategy & Market Analysis - W1 February 2026

Main Components Regime (Main Filter)

Bitcoin Index Market Phase

During the period 2026-01-26 - 2026-02-01, the market phase index not only failed to recover - it deteriorated at an accelerated pace. Values remained significantly below the recovery threshold of 0.43 throughout the week, so the model still does not register a reversal and interprets the regime as a transition to a more stressed configuration with internal state degradation. Based on the actual weekly data, the dynamics were first an attempt at stabilization, followed by a sharp breakdown: The week started at NUPL 0.362 (January 26). There was a brief bounce to a local maximum of 0.373 (January 28) - an attempt to hold the “transitional” corridor, but without continuation. Then rapid degradation began: 0.353 (January 29) -> 0.327 (January 30) -> 0.314 (January 31) and the final drop to 0.290 (February 1) - the week’s minimum. Such movement indicates rapid compression of unrealized profit and growing internal pressure: the market is moving closer to a state where participants become structurally vulnerable, and any external negative more easily shifts the system into stress/loss mode. Price confirms this shift and reinforces the regime quality signal: The week started around 87.8k (January 26) and ended around 78.7k (February 1). The weekly decline was approximately -10.4% (versus -5.1% the previous week). The local price maximum occurred on January 28 (~89.4k) - simultaneously with the index maximum, after which a synchronized drawdown of price and metric began. Week summary: structurally things became noticeably worse than the previous week. The index not only remained below 0.43 - it broke down to around 0.29, and the price went below 80k. Until the index returns and consolidates above 0.43, the configuration remains fragile and now prone to accelerated deterioration, where negative triggers have a higher chance of leading to a more pronounced bear regime.

Cycle Timing

Bitcoin Halving Cycles

During the week of 2026-01-26 - 2026-02-01, the model remained in the bearish macro regime (BEAR). Almost the entire period the market was in BEAR CORRECTION, which is confirmed by the consistently negative MVRV Z-score and negative 21/400 spread throughout the week. This means that the medium-term impulse continues to weaken, and any local bounces look technical and do not qualify as confirmed recovery. Breaking down the week by dynamics, it looked like a short attempt at stabilization followed by accelerated decline: The week started in BEAR CORRECTION with price around 87.7k (January 26). Then there was a small bounce to a local maximum of ~89.4k (January 28), but it did not hold. After January 28, rapid degradation began: price dropped to ~86.6k (January 29), then to ~83.1k (January 30), ~81.6k (January 31) and ended the week at ~78.6k (February 1). Key metrics deteriorated synchronously with price. MVRV Z-score for available days of the week dropped from approximately -1.57 (January 26) to -2.30 (January 31), meaning it went deeper into negative territory. The 21/400 spread also remained negative and became slightly more negative by the end of the week (approximately from -1.742 to -1.773). This corresponds to a scenario where structural pressure is growing, and there is no sustained reduction in “bearish” impulse. By the end of the week, a formal shift to BEAR NEUTRAL occurred (February 1), but in substance this looks like a formal reclassification against the backdrop of a price collapse, rather than recovery: key metrics (MVRV Z and 21/400 spread) are missing for the last day of the week, so confirming the quality of this “NEUTRAL” is impossible. The week’s outcome is logically described as BEAR CORRECTION -> (formally) BEAR NEUTRAL, but with an important caveat: almost the entire week passed in confident correction with deteriorating metrics and accelerated price decline. The BEAR macro structure has not changed, and until MVRV Z returns closer to zero and the 21/400 spread begins to consistently narrow in absolute value, the market remains vulnerable - the balance can easily shift into a new wave of decline with any negative trigger.

Point Triggers

1. Bitcoin Advanced Net UTXO Supply Ratio

The week of 2026-01-26 - 2026-02-01 gave an even stronger deterioration signal: if in the previous period the metric only broke below the 0.34-0.40 corridor and closed at 0.319, this week it failed to return to the “critical corridor” at all and instead of stabilizing went into accelerated decline with new local lows. Net UTXO Supply Ratio started already in the weak zone at 0.289 (Jan 26) and in the first days attempted a bounce: 0.312 (Jan 27) and local peak 0.360 (Jan 28). But this was not a reversal, but a brief technical return - the very next day the structure broke: the metric sharply fell to 0.246 (Jan 29) and then cascading deterioration began - 0.134 (Jan 30), 0.127 (Jan 31) and the final weekly close at 0.112 (Feb 1). That is, the week passed in “stair-step descent” mode, where the January 28 bounce turned out to be the last attempt to hold on, after which pressure only intensified. Main conclusion of the week: the market not only failed to return the indicator above 0.34, but also went significantly below the previous close of 0.319 - the week’s finish at 0.112 means a sharp increase in risk and growing probability of continued weakness if there is no clear demand reversal.

2. BTC Buy/Sell Index & Risk (v1.2.1)

During the week of 2026-01-26 - 2026-02-01, derivative flow gave a stronger bearish signal than the previous week. Buy/Sell Index by “raw” values remained negative every day, without any positive spikes, and the smoothed SMA 7D accelerated deeper into negative territory - from approximately -12 at the beginning of the week to around -38 by the close. This means the weekly futures flow balance shifted into a sustained risk-off mode, where growth attempts are systematically suppressed by derivative flow, and bounces are purely technical in nature. At the level of longer-term inertia, the picture also deteriorated. SMA 30D remained negative throughout the week and became noticeably more negative - from approximately -3.5 to -9.1, indicating that weakness is being pulled from the short-term impulse into a more sustained background. At the same time, Risk Buy % was above 50% for most of the week, which looks like attempts to “buy the dip,” but they failed to change the overall balance - derivative flow continued to work against the price, which was confirmed by BTC falling from around 88k to 79k. Summary: the derivative structure has consolidated in bearish mode. Until SMA 7D returns at least to zero and holds above it, bounces remain vulnerable, and pressure from futures flow remains dominant.

Strategy Status for the Week January 26 - February 1, 2026

The week was not just a continuation of weakness, but a transition to a more severe phase of structural degradation. The transitional regime formally persists, but Index Market Phase not only did not approach the recovery threshold of 0.43, but accelerated downward. This is no longer “decline after a failed recovery,” but deepening into a zone where unrealized profit is rapidly compressing and the market becomes structurally vulnerable to any external triggers. The macro context remained bearish, but the character of movement became noticeably more aggressive. Almost the entire week was spent in BEAR CORRECTION, confirmed by deeper negative MVRV Z-score values and the persisting negative 21/400 spread. The formal shift to BEAR NEUTRAL at the week’s close looks even weaker than the previous week: it occurred against the backdrop of a sharp price drop and in the absence of confirming values for key metrics. In essence, this is not stabilization, but a pause after accelerated decline, where the regime remains bearish and the structure unstable. The on-chain picture intensified the negative. Net UTXO Supply Ratio not only failed to recover, but shifted to cascading deterioration mode. This means loss of support not only below the 0.34-0.40 corridor, but also a move into a zone where the risk of continued weakness sharply increases if new, already non-technical demand does not appear. Derivative flow definitively confirmed the regime shift to strongly negative. Buy/Sell Index by “raw” values was negative every day, and SMA 7D accelerated its deterioration from around -12 to -38, becoming a source of systematic pressure. Simultaneously, SMA 30D deepened from approximately -3.5 to -9.1, indicating that weakness is being pulled into a longer horizon. Despite the fact that Risk Buy % was above 50% for most of the week, this demand proved insufficient and failed to reverse the overall balance - derivative flow continued to work against price. Price fully synchronized with structural deterioration: the week started around $87.8k and ended around $78.7k, meaning the market lost not only the 90k level, but accelerated below 80k against the backdrop of simultaneous deterioration in the market phase index, on-chain metrics, and derivatives. Summary: the base case scenario has shifted from “deterioration after failed recovery” to a phase of accelerated structural degradation. All three key conditions for regime change remain broken: Index Market Phase deepened further and remains significantly below 0.43. On-chain structure sharply deteriorated - Net UTXO moved to around 0.11. Derivative flow became firmly negative on both SMA 7D and SMA 30D. The key test for next week - will any new support appear: stabilization of Net UTXO above 0.20-0.30 and simultaneous easing of pressure on SMA 7D Buy/Sell Index. Without this, the current configuration remains bearish with elevated risk of continued pressure, and any bounces are still read as technical.

BITCOIN DEEP RESEARCH

In the Deep Research section today we will analyze two models - Open Interest Momentum Index and Funding Rate Cycles - to understand the status of the derivatives market. You will find the full breakdown of these models and SQL links in SQL of the Week #005 (Funding Rate Cycles Index) and SQL of the Week #004 Open Interest Momentum Index.

Open Interest Momentum Index

1) Week Summary in Numbers BTC (close): 88,335 -> 78,022 = -11.67% Open Interest: 2,038,391,755 -> 1,790,940,765 = -12.14% Weekly range (high-low): 90,487 / 75,473 = ~19.89% (very high volatility) OI vs 90D avg: from -5.9% (2026-01-26) deteriorated to -15.8% (2026-02-01) = derivatives are “deflating” relative to the 90-day base. 2) Regimes by Day (Your Classification) 2026-01-26: Deleveraging (Moderate) 2026-01-27: Spot-Led Rally 2026-01-28: Deleveraging (Moderate) 2026-01-29: Distribution (Building) 2026-01-30: Distribution (Building) 2026-01-31: Deleveraging (Moderate) 2026-02-01: Deleveraging (Extreme) Meaning: the week went through a short “breather,” then 2 days of “distribution/risk building” on falling prices, and ended with hard deleveraging. 3) What Exactly Triggered the Composite Index (0-5) Over the week, components triggered as follows: c1 OI momentum (OI > p80): 0/7 days c2 Price momentum (Price > p80): 0/7 days c5 OI level (OI vs 90d > p80): 0/7 days That is, there was no “strong” upward impulse and OI level overheating. Only these triggered: c3 Divergence (OI 7d - Price 7d > 5): 3/7 days (2026-01-29 .. 2026-01-31) c4 Acceleration (OI accel > 0): 4/7 days (2026-01-28 .. 2026-01-31) Key conclusion: the rise in smoothed_score toward the end of the week (to 0.88) was not from strength, but from divergence + local acceleration - and this is a bad type of “improvement” on falling prices. 4) Culmination: 2026-02-01 OI 7d % = -11.93%, below your oi p20 = -5.34 Price 7d % = -9.89%, below your px p20 = -5.05 The regime is natural: Deleveraging (Extreme) This looks like massive leverage closing/OI compression, not a “healthy correction.” 5) Week Interpretation (Brief, Business-Like) The week was risk-off in derivatives: OI is falling even faster/at par with price, and by the end of the week OI became significantly below the 90-day norm. “Distribution (Building)” (2026-01-29 .. 2026-01-30) occurred because OI held better than price (divergence of 6-8 pp) - this often means short/hedge building or toxic position structure on the decline. The week’s finale confirmed that this structure did not hold - the market shifted to hard deleveraging.

Funding Rate Cycles

1) Week Summary in Numbers BTC (close): 86,602 -> 78,802 = -9.01% Funding rate (daily): 0.00510 -> 0.00361 (decline of -0.00148) Average funding rate for the week: 0.00499 Funding rate range for the week: 0.00285 .. 0.00702 Streak: funding positive for 69 days in a row 2) Regimes by Day (funding_cycle_regime) and Activity Funding Cycle Regime: LONG-BIASED: 2 days (01-25, 01-26) BALANCED: 4 days (01-27 .. 01-30) SHORT-BIASED: 1 day (01-31) Activity Level: MODERATE ACTIVITY: 3 days (01-25, 01-26, 01-31) LOW ACTIVITY: 4 days (01-27 .. 01-30) Diagnosis: the week started with a moderately “long” bias, then quickly shifted to balance/fading, and on 01-31 the model already shows shift toward short (but without extremes). 3) “Cycle” Dynamics (Funding Cycle Z) Funding Cycle Z: from +1.24 (01-26) to -0.81 (01-31) That is, there was a vector reversal during the week: from long bias to short bias. Smoothed Score (0-5, 7d avg): from 0.86 (01-25/01-26) to 0.14 (01-31) This means that by components, signal activity is fading, not building. 4) What Actually “Triggered” in Components (0/1) Over 7 days: c1 level (|z| >= 2): 0 c2 persistence (accumulation in streak): 0 c3 divergence (z against price): 0 c4 momentum (Δz over 7d >= 1 in absolute terms): 1 (only 01-26) c5 reset (segment change after 7+ days): 0 Key meaning: the model says “not extreme and not overheated,” but at the same time longs are still consistently paying (funding sign is positive and streak is huge). 5) Model’s Trading Conclusion for the Week (trade_signal) HOLD/ADD (Balanced, 58% 30D WR): 4 days NEUTRAL (Follow Trend): 3 days 6) Week Summary Price dropped significantly (-9%). Funding remained positive all week (longs pay), and the streak reached 69 days. At the same time, the “cycle” by z-score reversed downward: +1.24 -> -0.81, and the composite smoothed score faded (0.86 -> 0.14). This looks like a phase when the long bias did not disappear instantly, but the “temperature” by components is already deflating. Conclusion: Based on data from both models, deleveraging has already occurred: over the week, open interest decreased by approximately 12% against a price drop of around 12%, and on the final day the signal shifted to Deleveraging (Extreme) regime, which is typical for forced leverage compression and position closing. At the same time, this is most likely not a complete derivatives washout, but rather significant compression: in the funding model, the rate remained positive and the streak extends to 69 days, meaning the long bias has not completely disappeared, although the market “temperature” has noticeably cooled - funding cycle z reversed from a moderately long bias toward short bias, and the smoothed score faded, which is consistent with partial unloading and reduced activity. Practically, this means that a technical bounce is possible in the coming days following the completion of forced selling, but for a sustainable reversal, confirmation is needed that OI has stabilized and funding has returned closer to neutral (or briefly goes negative), otherwise the risk of a repeated wave of pressure remains.

SUMMARY

Final Conclusion

The week of January 26 - February 1 was not a continuation of weakness, but a transition to a more severe degradation phase, where the attempt to hold the transitional corridor ended with a sharp breakdown and accelerated decline. Index Market Phase not only remained below the recovery threshold of 0.43, but collapsed to 0.29 at the week’s close, meaning rapid compression of unrealized profit and growing internal pressure, while price synchronously confirmed this shift by falling from the 88-89k zone to 78-79k and losing the 80k level. The macro filter by cycle stayed in BEAR CORRECTION for most of the week and was accompanied by deepening negative MVRV Z and negative 21/400 spread, while the formal shift to BEAR NEUTRAL at the finale looks more like a classification pause against the backdrop of a price collapse than a sign of stabilization, since confirming values for key metrics are missing at the last data point. The on-chain structure gave the most alarming signal: Advanced Net UTXO Supply Ratio after a brief technical bounce on January 28 failed to hold even close to the 0.34-0.40 corridor and went into cascading decline to 0.11, which reads as loss of the market’s ability to absorb supply at current levels and a sharp increase in vulnerability to further pressure. The derivative layer confirmed the bearish configuration through flow via Buy/Sell Index: SMA 7D accelerated its deterioration to around -38, and SMA 30D deepened to around -9, meaning weakness has been pulled from tactical into a more sustained background, and this makes any bounces statistically vulnerable. In Deep Research, two derivative models show that deleveraging has already occurred, but most likely did not end with a complete washout: Open Interest decreased by approximately 12% over the week along with price and ended the period in Deleveraging (Extreme) regime, which is typical for forced leverage compression and position closing, however funding still remains positive with a long streak, meaning the long bias is not completely removed, although the “temperature” has noticeably cooled and the cycle has reversed toward short bias. The final scenario for the coming week remains defensive: a base reversal support will only appear with simultaneous stabilization of on-chain metrics and clear easing of pressure on derivative flow, and until these conditions are met, upward movements should be interpreted as technical bounces within a bearish configuration, where the risk of a repeated wave of pressure remains.