CryptoQuant’s market-cycle gauge has tumbled back into deep bearish territory — the weakest reading since the 2022 post‑FTX bottom. In a recent post on X, CryptoQuant community analyst Maartunn highlighted a sharp decline in the Bitcoin Bull‑Bear Market Cycle Indicator, a composite measure that signals which phase of the cycle Bitcoin is in. The indicator is derived from the P&L Index, itself a synthesis of key on‑chain valuation metrics: MVRV and NUPL (both measuring unrealized network profits and losses) and the long‑term/short‑term SOPR (which measures realized profit and loss from transactions). How the signal works - The P&L Index is compared to its 365‑day moving average (MA). - When the P&L Index crosses above that MA, it suggests a shift toward a bullish regime; a cross below suggests a move into bearish territory. - The Bull‑Bear Market Cycle Indicator quantifies the distance between the P&L Index and its 365‑day MA to highlight regime shifts and extremes. What the recent drop means - The indicator slipped below zero in late 2025, indicating the P&L Index fell beneath its 365‑day MA. - Since then, the metric has continued to slide and now sits at lows not seen since the 2022 bear‑market bottom that followed the FTX collapse. - Historically, readings at these extreme levels have coincided with market lows — though the indicator typically spends some time in the “extreme bear” zone before a reversal occurs. Implications for traders and investors - The plunge underscores growing downside pressure in on‑chain valuation signals. - While past behaviour suggests a potential approach toward a market bottom, the indicator’s history also cautions that extreme bear readings can persist for weeks or months. Market snapshot At the time of Maartunn’s post, Bitcoin was trading around $68,000, down roughly 4% over the past seven days. Read more AI-generated news on: undefined/news

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