CryptoQuant’s Bull-Bear Indicator Plunges To Most Bearish Level Since 2022
On-chain data from CryptoQuant shows Bitcoin’s Bull-Bear Market Cycle Indicator has fallen deep into bearish territory, reaching levels last seen during the late-2022 market bottom that followed the FTX collapse.
What the indicator measures
The Bull-Bear Market Cycle Indicator is derived from CryptoQuant’s P&L Index, a composite valuation metric built from several on-chain data points:
- MVRV Ratio and NUPL: Gauge unrealized profits and losses across the network.
- LTH/STH SOPR: Tracks realized profits and losses for long-term and short-term holders through their transactions.
According to CryptoQuant’s methodology, the P&L Index’s interaction with its 365-day moving average (MA) helps identify regime shifts. A break above the MA suggests a transition into a bullish phase, while a drop below it signals a bearish turn. The Bull-Bear Market Cycle Indicator measures the distance between the P&L Index and its 365-day MA to highlight both transitions and potential extremes.
Latest readings point to “extreme bear” conditions
In a post on X, CryptoQuant community analyst Maartunn noted that the indicator slipped below zero in recent months as the P&L Index fell under its 365-day MA, indicating a bearish shift. The metric has continued to drift lower alongside Bitcoin’s negative price action and is now at its most depressed level since the 2022 bear-market low.
Historically, market troughs have often formed when this indicator approaches similarly extreme readings. However, the metric has also tended to remain in the “extreme bear” zone for a period before a sustained reversal occurs, making timing uncertain.
Market snapshot
At press time, Bitcoin traded near $68,000, down about 4% over the past week.