While the recent decline in Bitcoin price continues to move towards the $65,000 region, some on-chain indicators indicate that the market is approaching the bottom formation in the bear cycle. This outlook in the market is evaluated especially through short-term investor behavior and long-term technical averages.
Technical and on-chain signals came to the fore for the bottom zone
Bitcoin quant account known as Frank, who shares analysis on the X platform, argues that the harshest part of the downward trend in the BTC price may be behind. Frank states that the current structure is similar to past major bottoms and that many bottom signals are activated at the same time. The account is named after economist Frank A. Fetter.
Frank emphasizes that the current outlook constitutes a “Bitcoin bottom with a lesson” and that this will be seen more clearly in hindsight.
One of the headlines that stood out in this evaluation was the 200-week simple moving average for Bitcoin. In the chart shared by Frank, it can be seen that the BTC-dollar parity has reached a critical turning point again with this long-term average and various quantile ranges.
Mini-dictionary: A quantile is a statistical range that divides a data set into specific sections. Analysts use this method to understand where the price has historically tended to reverse.
Especially the ninth quantile attracts attention. This region stood out as the return area at the bottom of the 2022 bear market and in the sharp sell-off caused by Covid 19 in March 2020. The current price movement has also approached the same region again.
Profit selling of short-term investors attracted attention
The second important topic in the analysis was short-term investors. Wallets that hold BTC for up to six months and do not sell during this period can give early signals of direction changes in the market. The STH SOPR indicator, which measures the on-chain profitability of this group, moved into the positive area again.
STH SOPR is monitored as a ratio that shows whether short-term investors carry the coins they transfer with a profit or a loss. The indicator turning green reveals that this group of investors has started to write profits in small recoveries. This behavior is more common in bull markets, according to some analysts.
The fact that short-term investors started to sell at a profit again indicates that a change in direction may have begun in the market.
Cautious views also remained on the table
However, not all analyzes are equally optimistic. On-chain data platform CryptoQuant has warned that the STH SOPR indicator may need to test lower levels before a stronger bottom zone forms.
CryptoQuant writer Trader Germini recalled that in previous local bottoms, short-term investors capitulated more harshly and the indicator moved into deeper capitulation areas around around 0.93. He noted that the current level has not yet reached a panic selling zone of this scale.
The increasingly stronger view in the market is that we may have entered the final phase of the 2026 month period. Still, some analysts think it is necessary to watch whether speculative investors will go through a stronger liquidation process for permanent bottom confirmation.
