Recent statistics have unveiled a significant transformation in the overall market trend within the cryptocurrency realm. Julio Moreno, a prominent analyst at CryptoQuant, has indicated that the Bull-Bear Market Cycle Indicator is signaling the onset of a BEAR market, suggesting a potential downturn ahead. This marks the first occurrence of such a signal since January of the previous year. Moreno shared the details of this development on his official X account.
For the first time since January 2023, the Bull-Bear Market Cycle Indicator has identified a BEAR phase (depicted in high blue areas). Previous instances of brief BEAR phases were observed during the COVID sell-off in March 2020 and following the Chinese mining ban in May 2021.
The CryptoQuant analyst emphasized that the Bull-Bear Market Cycle Indicator has historically proven to be an accurate predictor of market trends. This indicator serves as a momentum gauge, assessing market sentiment by analyzing the disparity between the 365-day moving average and the Profit and Loss Index. Its role in identifying market cycles is considered crucial.
The Bear Cycle indicator has dipped below the 0 level as well as the corresponding 365-day moving average, signaling a bearish market phase. Historically, this indicator has successfully highlighted major market shifts. Notably, it accurately identified the sell-off during the COVID-19 pandemic in March 2020 and again in May 2021.
This latest development suggests the beginning of a period characterized by price declines and diminished returns. During these historical instances, the indicator effectively anticipated temporary bearish phases. Remarkably, it also forecasted the onset of the prolonged bear market that began in November 2021, demonstrating its reliability. According to the CryptoQuant analyst, the current indications suggest that the market may be heading into a phase of decreasing prices and lower returns.