Bitcoin Bear Market Enters Mid-Phase as Selling Pressure Eases

Recent on-chain data suggests a shift in the current Bitcoin (BTC) market cycle, as extreme selling pressure begins to subside. According to an analysis by CryptoQuant analyst Axel, the digital asset may have moved into a mid-term phase of the bear market. While the immediate intensity of the sell-off appears to be moderating, technical indicators suggest that the market has not yet reached a definitive cyclical bottom, leaving room for further volatility before a sustained recovery begins.

Analyzing the NUPL-MVRV Harmonic Composite

The primary basis for this assessment is the NUPL–MVRV harmonic composite indicator, a metric used to evaluate market sentiment and unrealized profits or losses. Axel noted that this indicator recently touched the 0.33 level. In previous market cycles, a true bottom—representing the point of maximum financial opportunity—has typically been recorded when this figure reaches approximately 0.5.

The Net Unrealized Profit/Loss (NUPL) and Market Value to Realized Value (MVRV) ratios are critical tools for determining whether a cryptocurrency is overvalued or undervalued relative to its "fair" historical cost basis.

• The current reading of 0.33 indicates a cooling of the aggressive downward trend.
• Historical data shows a significant gap remains between current levels and the 0.5 bottoming threshold.
• The upward trajectory within the bear cycle suggests the "capitulation phase" may be evolving into a longer-term consolidation.

Market Implications and Mid-Term Outlook

The transition into a mid-term bear market phase implies that the most violent part of the price discovery process might be slowing down, yet the lack of a confirmed bottom suggests that a full market-wide recovery is not imminent. This period is often characterized by decreased liquidity and range-bound price action on the Bitcoin blockchain.

This indicates that extreme selling conditions are moderating, but the indicator remains far above the historical bottoming area, meaning that a market-wide sell-off has not yet been confirmed.

While the cooling of selling pressure provides some relief for long-term holders, the data serves as a reminder of the cyclical nature of the cryptocurrency markets. Investors and analysts continue to monitor on-chain metrics closely to determine if further corrections are necessary to align with historical bottoming patterns or if the current macro environment will deviate from previous BTC cycles.