Identifying the Bitcoin Bottom: Key Signals from Past Cycles

A specific on-chain indicator has effectively identified every significant Bitcoin cycle bottom over the last decade and is now nearing that crucial level once more.

Key Takeaways

The NUPL indicator has predicted Bitcoin's cycle bottoms accurately for the past ten years.
Bitcoin is currently showing a reading of 22.9 on the NUPL, indicating modest overall profits.
A potential deeper reset in sentiment may still be needed for a confirmed bottom.
Bitcoin is currently trading around $74,220, following a 1.3% rise in the past 24 hours.

Bitcoin

The analysis utilizes monthly Bitcoin charts alongside the NUPL (Net Unrealized Profit/Loss) indicator. This indicator reveals whether holders are in profit or loss. Historically, during the last three major bear market bottoms, the NUPL hit a similar level and touched an upward trendline, suggesting a potential pattern re-emergence.

Understanding the Bitcoin Cycle Bottoms

Bitcoin has recently broken above $70,000, escalating into the mid-$70,000s, which has brought back a positive sentiment among investors. The fear and greed index has shown some improvement, yet one question remains: Have we already seen the market's bottom, or is another significant downturn ahead?

Interestingly, a long-term analysis of the NUPL, which measures the unrealized profits or losses of holders, suggests that we may be observing a pattern that has emerged in previous market cycles.

The NUPL Indicator Explained

The NUPL indicator serves as a clear sentiment measure in Bitcoin analysis, simplifying the analysis to whether, on average, holders are experiencing profits or losses. High readings indicate substantial unrealized gains in the market, while sharp declines reveal losses as profits evaporate.

A review of the monthly candlestick chart illustrates that Bitcoin's major cycle lows typically occur when the NUPL falls into deeply negative territory while touching a long-term upward support line. This pattern was evident during the 2015 cycle bottom, recurred at the 2018 bear market low, and appeared again near the 2022 low. Each instance occurred after a significant erosion of sentiment and large declines from previous price peaks.

The current NUPL reading of 22.9 indicates the cryptocurrency remains in moderate aggregate profit, despite shedding a considerable portion of the gains it experienced during the rally that propelled it to an October 2025 peak of over $126,000.

Are We at the Bottom?

According to CrypFlow, a crypto analyst active on the platform X, the NUPL indicator is approaching the level typical of Bitcoin bottoms once again. If this trend continues, Bitcoin may require deeper sentiment reset before achieving a genuine long-term market recovery.

Bitcoin
Source: Chart from CrypFlow on X

Despite the price having already undergone significant correction, the NUPL suggests that the emotional capitulation seen in prior bottoms may not yet be complete. The NUPL may continue to decline towards the trendline before a bottom can be fully confirmed.

Related Reading: Analyst Indicates Bitcoin Bulls Are Prevailing and Identifies Next Target.

While no single indicator can accurately predict every bottom, the NUPL allows for the possibility that a final price drop could still be on the horizon before the next complete cycle of expansion begins. At the time of writing, Bitcoin is trading at $74,220, reflecting a 1.3% increase over the last 24 hours.

Bitcoin
BTC trading at $73,685 on the daily chart | Source: BTCUSDT on Tradingview.com