The Bitcoin bull-bear market cycle indicator, which monitors phases of investor sentiment, has transitioned to a bullish signal after spending three days in the red as Bitcoin’s price dropped to levels unseen since February.
“Most on-chain cyclical indicators for Bitcoin, which were teetering on the edge, have now reverted to indicating a bull market,” stated CryptoQuant founder and CEO Ki Young Ju in an X post on August 9.
“Bitcoin remains in a bull market,” echoed the pseudonymous crypto trader known as PlanB.
The indicator had entered “Bear” territory when Bitcoin’s price fell below $50,000. Source: CryptoQuant
“BTC was undervalued for just three days,” Ju noted. This assessment follows Bitcoin’s drop to $49,751 on August 5, which has been termed “Crypto Black Monday,” marking its first decline below $50,000 since February.
According to CoinMarketCap data, Bitcoin continued to trade below the critical threshold of $60,000 until August 8.
At the time of this writing, Bitcoin is priced at $60,732.
Bitcoin has experienced a slight decrease of 0.35% over the past week. Source: CoinMarketCap
The Bitcoin bull-bear market cycle indicator had not displayed a bear signal since January 2023, shortly after the FTX collapse.
It wasn’t the only one indicating bearish sentiment; the Crypto Fear and Greed Index also recorded an “Extreme Fear” score of 17 on August 6, the lowest since the FTX debacle. Since then, the score has recovered to a “Neutral” reading of 48.
Some Bitcoin traders speculate that the rapid reversal might indicate that the recent price drop was a bear trap—where seasoned traders sell Bitcoin strategically to temporarily depress the asset’s price, ensnaring short-sellers.
Analysts divided on future trends
While some analysts believe that Bitcoin’s recent downturn reflects patterns observed before past bull runs, others express caution.
On August 7, Markus Thielen, head of research at 10x Research, remarked that “to optimally time the next bull market entry, we are looking for Bitcoin prices to dip into the low 40,000s.”
In a report dated August 6, Ark Invest, the investment firm led by Cathie Wood, highlighted that Bitcoin’s crucial price supports lie at $52,000 and $46,000.
At the same time, veteran trader Peter Brandt noted that Bitcoin’s “decline since the halving is now comparable to that of the 2015-2017 halving bull market cycle,” implying that a bull run could be on the horizon.
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