ccording to data from CryptoQuant, Bitcoin may now be in a bear market. The platform's “Bull-Bear Market Cycle Indicator” is based on its P&L Index and it has now moved into the negative zone. The P&L Index unifies various well-known on-chain metrics to arrive at this conclusion.
The Indicator's Recent Trend
The indicator, which is based on the platform's P&L Index deviation above or below its 365-day moving average. The figure above 0 indicates a bull market while the figures below 0 indicate a bear market.
The Bull-Bear Market Cycle Indicator entered the “Overheated bull” earlier this year during the Bitcoin rise to $69K. For the first time the indicator has flagged a bear market since March 2023.
It remains unclear whether the recent drop will continue, however, CryptoQuant notes that the bear signals may have resulted from the recent market crash and will likely be a temporary phase.
Bitcoin Price Action
Over the past week, the value of Bitcoin has dropped nearly 20% due to several macroeconomic factors and is now trading at around $56-57K– 50% below its ATH. The price drop triggered the loss of about $1 billion in futures positions. As for now, investors look toward a bounce to stabilize the market.
