"This signal typically appears right before Bitcoin rallies," states Darkfrost, an analyst at CryptoQuant, highlighting an unusual on-chain indicator that suggests the bear market might be nearing its final stretch. This rare event occurs when the cost basis of short-term holders (STH) falls below that of long-term holders (LTH) for three consecutive days. Historically, such a pattern has marked the last phase of Bitcoin downturns, preceding significant recoveries.

In the recent bearish trend, new investors continued buying Bitcoin despite price drops, causing the acquisition cost for short-term holders to decline from $112,500 to nearly $69,000. This inversion where STH cost basis dips under LTH cost basis serves as a signal noticed in prior bear markets just before bulls take over. However, Darkfrost cautions this signal does not mean an immediate bullish reversal; rather, it indicates Bitcoin could be entering the concluding phase of the bear market.

Beyond signaling market phase shifts, this period historically offers dollar-cost averaging (DCA) investors an excellent entry point due to relatively low prices. Bitcoin’s resilience is notable: after dipping to $57,747 nearly three weeks ago, it rebounded and managed to sustain levels above the critical $60,000 support zone, despite selling pressure including Strategy’s sale of 3,588 BTC for almost $216 million as dividends. The next major resistance at $67,248 stands as a key level; surpassing it would strengthen the case for the bearish trend ending and the onset of a bullish run.

At the moment, Bitcoin trades around $64,141, maintaining a position between key support and resistance. The market awaits confirmation from this price action before fully shifting sentiment. For investors, recognizing this signal may help time strategic entries, especially considering past cycles where increased buying interest from new investors at prices exceeding LTH cost basis coincided with strong bull market commencements.

This material is informational and should not be considered financial advice.