Mar 13, 2026 · The Milk Road Show · 5 min read

On-Chain Signals Indicate Bitcoin Bear Market Stabilization

Analysis of on-chain data reveals easing selling pressure and stabilizing US demand in the Bitcoin market. While bear market conditions persist, key metrics suggest a shift from extreme capitulation to consolidation, with resistance identified at 76k-86k.

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The takeaways

Selling Pressure Eases After Capitulation. Extreme unrealized losses have exhausted short-term sellers, reducing downward pressure and allowing prices to consolidate between 60k and 74k. This dynamic marks a transition from active selling to market stabilization.
US Demand Shifts From Selling To Buying. The Coinbase premium has flipped from deeply negative to positive, indicating that US investors have stopped selling and are now driving relative demand. This regional shift supports price resilience against global bearish trends.
Spot Demand Contraction Slows Significantly. Apparent spot demand contraction has decelerated from 136,000 BTC to 46,000 BTC over a 30-day period. This slowdown suggests that while demand is not yet growing, the rate of outflow is diminishing.
Long-Term Holder Selling Hits Lows. Selling by long-term holders has reached its lowest 30-day pace since June 2025, removing a major source of supply pressure. This cohort typically drives significant volume, so their inactivity supports price floors.
Stablecoin Liquidity Trend Reverses. USDT market cap contraction has stabilized as the trend line crosses above its moving average. This indicates that while liquidity is not yet expanding, the downward trend is reversing, supporting market depth.
Resistance Zone Identified At 76k-86k. On-chain realized price bands suggest strong resistance between 76k and 86k, where previous support levels now act as ceilings. Traders should expect corrections if prices reach this zone without a regime shift.

Market Regime Analysis

Current on-chain data indicates that the Bitcoin market remains in a bear regime but is exhibiting signs of stabilization. The CryptoQuant Bull Score Index has risen from zero to 30, reflecting a shift from extreme bearish conditions to moderate bearishness. This improvement coincides with price consolidation between 60,000 and 74,000 USD, suggesting that the most severe selling pressure has subsided.

Demand Dynamics

A critical shift is observed in US investor behavior. The Coinbase premium, which tracks relative US demand, has flipped from deeply negative to positive. This indicates that US investors have ceased selling and are now providing marginal demand support. Concurrently, apparent spot demand contraction has slowed significantly, dropping from a 30-day loss of 136,000 BTC to 46,000 BTC. While demand remains negative, the deceleration in outflows is a positive leading indicator for price stability.

Supply Side Factors

Selling pressure from long-term holders has reached its lowest 30-day pace since June 2025. This cohort, which typically exerts significant downward pressure during bear markets, is currently inactive. Additionally, the metric for unrealized losses has reached extreme levels, a historical signal that selling pressure is exhausted as holders are unwilling to realize further losses. This capitulation phase often precedes market bottoms or relief rallies.

Liquidity and Resistance

Stablecoin liquidity, measured by USDT market cap, has stabilized after a period of contraction. The trend line crossing above its moving average suggests a potential reversal in liquidity trends, which is essential for sustaining price gains. However, traders face significant resistance between 76,000 and 86,000 USD. This zone, derived from on-chain realized price bands, acts as a ceiling in bear markets. A breakout above this range would require a shift in the Bull Score Index to above 60-70, signaling a transition to a bull regime.

Strategic Implications

Investors should interpret current signals as a relief rally within a bear market, not a confirmed trend reversal. The convergence of easing selling pressure, stabilizing US demand, and reduced long-term holder activity supports short-term price resilience. However, until the Bull Score Index spikes significantly and liquidity expands, the market remains vulnerable to corrections. Monitoring the 76k-86k resistance zone and the Bull Score Index is crucial for identifying potential regime changes.

Key insights

The market is in a bear regime but showing stabilization signs, with the Bull Score Index rising from 0 to 30. This indicates a shift from extreme fear to moderate bearishness, supporting price consolidation.

Market Regime →

Impact: Investors can use this index to gauge market sentiment and identify potential entry points during bear market rallies.
US demand has shifted from selling to buying, as evidenced by the positive Coinbase premium. This regional demand support is crucial for price resilience in a global bear market.

Regional Demand →

Impact: Positive US demand signals can drive price strength and attract global investors, potentially accelerating market recovery.
Spot demand contraction has slowed from 136,000 BTC to 46,000 BTC over 30 days. This deceleration suggests that while demand is not growing, the rate of outflow is diminishing.

Demand Trends →

Impact: Slowing demand contraction reduces downward pressure on prices, supporting market stability and potential recovery.
Long-term holder selling has reached its lowest 30-day pace since June 2025. This inactivity removes a major source of supply pressure, supporting price floors.

Supply Dynamics →

Impact: Reduced selling from long-term holders can lead to price appreciation as supply tightens, especially during bear market rallies.
Stablecoin liquidity has stabilized, with the USDT trend line crossing above its moving average. This suggests a potential reversal in liquidity trends, supporting market depth.

Liquidity →

Impact: Stabilizing liquidity is essential for sustaining price gains and reducing volatility, making the market more attractive for institutional investors.

Action items

Monitor the Bull Score Index for spikes above 60-70, which would signal a transition to a bull regime. Use this as a primary indicator for long-term investment decisions.

Impact: Identifying regime changes early allows investors to adjust their strategies and capture significant upside potential.
Track the Coinbase premium to gauge US demand trends. A sustained positive premium indicates strong US demand, which can drive global price strength.

Impact: Understanding regional demand dynamics helps investors anticipate price movements and identify potential breakout opportunities.
Watch for a slowdown in spot demand contraction, as indicated by the 30-day apparent demand metric. A deceleration in outflows is a positive leading indicator for price stability.

Impact: Early detection of demand stabilization can help investors position for potential price rebounds before the broader market reacts.
Assess long-term holder selling activity to gauge supply pressure. Low selling activity from this cohort supports price floors and reduces downside risk.

Impact: Reduced supply pressure from long-term holders can lead to price appreciation, especially during bear market rallies.
Monitor stablecoin liquidity trends, particularly USDT market cap changes. A reversal in the contraction trend supports market depth and price sustainability.

Impact: Stabilizing liquidity reduces volatility and supports price gains, making the market more attractive for institutional investors.

Quotes

“Selling pressure is gone, or you know, a really minimal levels when there's no more profits to be made, right? It's just losses.”

“We are still inside the bear market, but at least for for the for the time being, not not that bearish.”

“When we are in a bear market, then probably like you have a rally and then it's selling opportunity.”