A major Bitcoin on-chain indicator is now showing its strongest capitulation reading since 2018, suggesting the market may be nearing a potential cycle bottom.
Historic Rally Signal Just Flashed: Is A Bullish Reversal Coming?
Fresh on-chain insights from Checkonchain reveal that Bitcoin’s short-term holder stress has declined to a multi-year low comparable to the 2018 cycle bottom. The Short-Term Holder (STH) Bollinger Band metric indicates the oscillator has entered its most oversold zone in almost eight years.
The metric uses Bollinger Bands to analyze the difference between Bitcoin’s spot price and the average cost basis of short-term holders — typically wallets holding BTC for under 155 days.
When the oscillator breaks below the lower band, it implies that Bitcoin is trading well beneath the purchase levels of recent buyers, outside typical historical volatility. In past cycles, such conditions have frequently coincided with broader market bottoms.
Historical data shows a similar oversold signal in late 2018, which was followed by a roughly 150% recovery within 12 months and a staggering 1,900% gain over the following 3 years.
The indicator also triggered prior to the November 2022 market bottom. What followed was a powerful recovery phase, with Bitcoin surging approximately 700% and ultimately hitting a record high of $126,080 in October 2025.
The start of 2026 has been rough for crypto investors, with the market shedding over $2 trillion in value since last October. Bitcoin recently slumped to a 16-month low of around $60,000, sparking approximately $5 billion in liquidations within 72 hours.
Market experts attribute the recent crypto sell-off to a convergence of several factors: Kevin Warsh’s nomination as Fed Chair, suggesting tighter monetary conditions; large-scale redemptions from U.S. spot ETFs; and a broader move from risky bets, with investors exiting both crypto markets and growth-oriented tech equities.
At the time of reporting, the apex cryptocurrency was hovering around $65,998, reflecting a 1.9% decline on the day, according to CoinGecko data.
Source: https://zycrypto.com/rare-signal-that-preceded-bitcoins-meteoric-1900-moonshot-just-lit-up-again/
