The Bitcoin bull-bear market cycle indicator, which tracks investor sentiment phases, has flipped to signal bullish conditions, following three days of flashing red as Bitcoin’s price plummeted to levels not seen since February.
“Most Bitcoin on-chain cyclical indicators that were hovering near the borderline have now shifted back to signaling a bull market,” CryptoQuant founder aKi Young Ju wrote in an Aug. 9 X post.
“Bitcoin is still in a bull market,” pseudonymous crypto trader PlanB added.
“BTC was discounted for only three days,” Ju claimed. The analysis comes after Bitcoin fell to $49,751 on Aug. 5, which is being called “Crypto Black Monday.” It was its first drop below $50,000 since February.
Bitcoin then traded below the critical key level of $60,000 until Aug. 8, according to CoinMarketCap data.
At the time of publication, Bitcoin is trading at $60,732.
The Bitcoin bull-bear market cycle indicator hadn’t flashed a bear signal since January 2023, shortly after the FTX collapse.
It wasn’t alone in signaling bearish sentiment, the Crypto Fear and Greed Index also hit an “Extreme Fear” score of 17 on Aug. 6, the lowest since the FTX crash.
Since then, the score has bounced back to a “Neutral” reading of 48.
Some Bitcoin traders believe the quick reversal suggests that the recent price dip might have been a bear trap — when experienced traders sell Bitcoin in a controlled manner to temporarily lower the asset’s price to trap short-sellers.
Analyst split on where to next
While some analysts think Bitcoin's recent downturn mirrors previous trends before bull runs, others are more skeptical.
On Aug. 7, 10x Research head of research Markus Thielen stated that “to ideally time the next bull market entry, we aim for Bitcoin prices to fall into the low 40,000s.”
Related: Bitcoin speculators hodl 2.8M BTC in ‘worst performing’ price cycle
In an Aug. 6 report, Cathie Wood's investment firm Ark Invest stated that Bitcoin's most important price supports are at $52,000 and $46,000.
Meanwhile, veteran trader Peter Brandt explained that Bitcoin's “decline since halving is now similar to that of the 2015-2017 halving bull market cycle,” suggesting that a bull run may follow.
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