Murphy

Wow, that's really impressive!

Let’s take a look at the institutional signal BSS, which has provided accurate alerts right before major bull runs over the past decade.

Throughout this timeline, the majority of the time, BSS peaks have hovered around 0.7-0.72. Almost all of these align with the top regions of BTC's major/minor swings.

However, there were only 5 instances where BSS suddenly spiked significantly, directly exceeding 0.85. Instances 1-4 all corresponded to the start of a bull market's main wave.

Only the 5th instance aligns with 2025.10.6 — the peak of the bull market. But, was this a false signal? Or did the event on 10.10 just four days later unexpectedly halt the bull run? We can't say for sure.

In any case, the almost eerie effectiveness of this professional-grade indicator has made me feel the power it holds. I’m really looking forward to the next time BSS breaks through 0.85, and I’ll raise my cup in celebration!

But definitely not right now, as BSS is currently at 0.71.

History never truly repeats, but it sure does rhyme!
That said, I didn't expect it to rhyme this much...

The "Investor Confidence Index" is showing fluctuations almost identical to the last cycle. It's just that compared to December 2021 - January 2022, this current phase is more "mini" and spans a shorter timeframe.

As of April 20, the distance of the red zone from returning to the zero axis is the same as on October 22, 2022.

In other words, if there aren’t any black swan events like the FTX debacle, the "Investor Confidence Index" is likely to bounce back to the zero axis in about 20 days.

What does returning to the zero axis mean? I don't need to spell it out for you, right? This will be a significant milestone!

Even if BTC dips again, or even breaks the previous low, as long as the deviation of the red zone is less than the previous lows (marked 3), we can confirm: this is the "last drop" of this bear market.

Bitcoin Sharpe Signal (BSS) is another interesting finding I made recently while researching Glassnode's exclusive signals.

The official explanation for this indicator is:
The Glassnode Bitcoin Sharpe signal uses a unique ML-based approach with on-chain data to strategically minimize downside risks and capture rising trends in Bitcoin.

It seems to be an indicator for assessing whether it is worthwhile to hold BTC at the moment.

However, I found that combining BSS with BRS (Bitcoin Risk Signal) seems to be more effective. For example, in the chart below, the top shows BRS, and the bottom shows BSS:

🚩 When BSS > 0.5 (dark green) and at the same time BRS = 0, it usually enhances our probability of judging a 'temporary peak' (the red shaded area in the chart);

🚩 When BSS < 0.3 (red) and at the same time BRS = 0, it usually strengthens the probability of judging a 'cost-effective bottom range' (the green shaded area in the chart);

Currently, BSS = 0.7, BRS = 0, which is in the state of the aforementioned condition 2. It seems that $78,000 indeed has a high probability of being at the top range of a temporary rebound.

Perhaps it is $78,000, or maybe just above $78,000. Is it really so? Let's verify.

Retail investors are quietly accumulating BTC!\n\nAccording to the on-chain statistics of actual holdings, in the past 7 days:\nSmall shrimp (holding <1 BTC) increased their total holdings by 11,520;\nCrabs (holding 1-10 BTC) increased their total holdings by 8,492.\n\nAlthough the absolute numbers are not large, for this group, it has already been the largest accumulation of chips since the drop last October.\n\nIsn't everyone saying that 50k is the bottom, and 40k is the bottom?\n\nIt turns out you are playing "quietly entering the village, don't shoot"......\n\nNow, the retail investors still playing BTC are all old hands and should have already 'evolved'.

Are there signs of a recovery in the bear market? We can comprehensively judge this through various on-chain behaviors. But if all composite signals are zero, then any price increase during this period is only considered a rebound, not a reversal.

Just like now!

The dotted line in the chart outlines areas where there is no color present, indicating that currently BTC is:

In terms of key pricing models (technical models and on-chain models), network utilization (on-chain activity, network congestion), market profitability (changes in selling momentum, whether profits are being absorbed), supply distribution trends, and other multidimensional aspects, there have been no more constructive changes.

It can be used as a right-side indicator for a large-scale trend reversal to ensure that we do not miss the next trend.

It's been a long time since the last update on PSIP (Profit Supply Percentage of BTC), the last time I wrote about it was back on December 10, 2025 (see citation).

At that time, we estimated that if PSIP=50% was used as the bear market bottom range, then the pricing range would be around $62,000.

Have there been any new changes since then?
Definitely! The closer we get to the calculation results, the more accurate they become.

Looking back at history, we can find a detail:

During the 2014-15 cycle, the PSIP at the bear bottom range fell around 40%-45%; the same goes for the 2018-19 cycle. After that, during the Black Swan event on March 12 and the bear bottom in 2022, PSIP never fell below 45% again.

From a theoretical perspective, over time, the low-cost "profit chips" that are lost or held long-term will increasingly accumulate; thus, the PSIP is bound to be higher than before, almost an inevitable trend.

Based on this, we can infer: the PSIP at this bear bottom is very likely not to fall below 45%!

It is most likely to fall within the ranges of 50%-55% or 45%-50%. As of April 5, the PSIP is approximately 55%, already at the "upper edge" of the expected range mentioned above.

Therefore, when BTC approaches this range, from a rational perspective, it should not be overly bearish anymore.

Can you imagine? The average cost of all the losing chips currently is not 100,000, not 110,000, but only $93,600!

In other words, under the current loss structure, as long as BTC rises back to 93,000, it can allow the average of the losing chips to break even (the red line in the chart).

Although there are still many chips trapped above, it can be concluded that during the two rapid declines at the end of last year and the beginning of this year, a large number of high-position trapped chips must have chosen to cut losses and leave the market, which lowered the average cost of the overall floating loss chips.

This is what we usually understand as — washout!

This value has a deviation coefficient of 1.4 compared to the current 30-day average BTC price, while in the past three bear market bottoms, the deviation coefficients have at least exceeded 2.0 (the blue waveform below).

Greater than or equal to 2.0 represents that when entering the absolute bottom range, BTC's price is less than half of the "average cost of losing chips".

To meet this condition, BTC must drop to $46,800.

If it doesn't drop to that level, then this will be the most special bear market in history! Because in terms of "degree of pain", it is much lighter than any previous bear market.

Will this law be broken in this round? Personally, I think it "is very likely to"......
(That is, I do not believe it will drop this low)

Of course, if it really happens, then what are you hesitating for? Just "sell a kidney"!

Q1 2026 is a winter period for the cryptocurrency industry, with participation declining, liquidity shrinking, and trading volume sluggish. Even the 'landlord's family' should be having a tough time.

In CoinGlass's research report, liquidity is concentrating in the leading players, capital is concentrating in derivatives, and trust is seemingly concentrating in the giants, which has become an inevitable trend.

For instance, Binance ranks first in four key dimensions: derivatives trading volume, open interest, trading depth, and user capital commitment, demonstrating a clear leading advantage.

Especially in user capital commitment, it accounts for as high as 73.5% in CEX.

This is not merely about high trading volume; trading volume can be supported by activities or market-making strategies. However, the long-term retention of capital reflects user stickiness and usage habits.

Based on this, I conducted further validation using on-chain data. According to Glassnode's data, among Binance's reserve assets:

USDT reserves increased from $24.6 billion at the low point to $43.8 billion during the market transition from bull to bear. Although there was a temporary decline from January to March 2026, it quickly rebounded (Figure 1).

In contrast, BTC reserves have been even more stable. Over the past five years, there was only one sudden drop during the FTX collapse (November 2022), after which it consistently recovered and remained above 550,000 coins (Figure 2).

The more reserve assets an exchange has, the more user assets correspondingly exist.

This also indicates that after experiencing a round of public opinion turmoil, users ultimately cast their 'trust votes' with their funds.

Data does not lie. In this protracted winter, the market's clamor has been stripped away, leaving only the most genuine survival cards.

The appearance of this signal means that starting from April 2, 2026, BTC has officially entered the second half of the bear market!

At least in terms of on-chain data, we are almost 100% certain of this. Because this situation is by no means common.

The yellow line and the orange line in the chart represent the on-chain average turnover cost for holding BTC for 1-2 years and 1-3 months, respectively; they have now crossed.

To analyze the logic behind this signal, you must first understand why the orange line decreases when the price drops, while the yellow line increases.

Previously, I wrote a tweet that explained in detail the principle of STH-RP not following price changes, which is fundamentally different from the 120d-ema in candlestick indicators. Interested friends can look it up themselves.

I won't repeat too much here; in short, you just need to know that this is a highly valuable effective signal.

As of March 31st, the latest CVDD (Cumulative Value Destroyed) has reached $45,410, an increase of only $506 compared to the data in the tweet on February 10th (see citation), indicating a very slow rate of increase.

The CVDD algorithm uses CDD (Cumulative Value Destroyed Days) in the numerator, meaning that when BTC is spent, the time value held by the original investor is simultaneously reset to zero.

Therefore, the slow increase suggests that during this period, early large holders have significantly reduced or even almost completely stopped participating in on-chain trading.

CVDD is one of the few indicators that has never "failed" since the inception of BTC! That is, the price of BTC has remained above CVDD every day; the bottom of the bear market has only approached it infinitely, but has never fallen below it.

If this cycle continues this pattern, it means that even if BTC experiences a "final drop," it will not fall below $45,500. There is a maximum potential drop of -30% from the current level, but the actual drop is likely not that large.

Based on the current relative deviation between the BTC price and CVDD (see the green arrow in the chart), similar deviations occurred on the following dates over the past 15 years: February 5, 2015; November 27, 2018; and June 22, 2022.

The prices over these three days are very close to the subsequent true bottom.

We might be unwilling to accept the theoretical maximum drop of -30%, or feel that the current risk-reward ratio is not yet favorable, so we can wait.

Alternatively, you could start dollar-cost averaging (DCA) in BTC now, or wait for an opportunity with a higher probability of occurrence and closer alignment with CVDD.

However, this is not investment advice, but simply a reminder that you should plan ahead.