Bitcoin's Bear Market Status Remains Uncertain According to On-Chain Data

Bitcoin's recent price action has left many wondering if it has finally confirmed a bull market reversal. However, on-chain data suggests otherwise.

The cryptocurrency saw minor losses in recent days of trading and its spot ETF inflow streak, the longest in nine months, was broken by a $225.1 million outflow on Thursday, July 23.

Bitcoin is still trading within a long-term bearish price trend, with the bulls' inability to break past the $67k local supply zone giving control of the market back to the bears.

The MVRV ratio, which shows that aggregate holders are still in profit when above 1, has not yet fallen below this level. Historically, the depths of bear markets have only been reached when the MVRV falls below 1, suggesting that Bitcoin may not have yet hit a bear market bottom.

Analyst Rei Researcher noted that the current cycle is far from bullish overheated territory, but not quite yet at bear market bottom. On-chain data suggests that cyclical capitulation might not have ended yet, with the recent bounce potentially allowing long-term holders to reduce exposure ahead of any further weakness.