The bull-bear indicator for Bitcoin has turned positive for the first time since March 2023.

A key on-chain indicator is pointing to an early shift in bitcoin’s market cycle, though analysts warn that the signal should be interpreted with caution.

CryptoQuant’s bull-bear cycle gauge has moved into green territory for the first time since 2023, suggesting that underlying market conditions are beginning to improve. According to on-chain analyst Julio Moreno, such transitions often indicate that the most severe phase of a downturn has passed and that a recovery may be taking shape.

Historically, this type of signal has aligned with major turning points in the market. When the indicator exits bearish territory, it typically reflects strengthening momentum beneath the surface, even if prices have yet to fully respond.

However, market participants stress that the indicator is not a forecasting tool. Mati Greenspan, founder of Quantum Economics, described it as a measure of market regime rather than a predictor of future price moves. Its primary value lies in identifying when bitcoin transitions away from bear-market behavior.

Greenspan noted that true confirmation depends on sustained demand, improving liquidity, and the market’s ability to maintain higher price levels. Until those factors materialize, price action remains the critical validation signal.

Previous instances in 2019 and early 2023 saw similar signals precede strong bullish trends. Still, Moreno highlighted March 2022 as an example of a false signal, when the indicator briefly turned positive before the market moved lower again.

The current environment presents a mixed picture. While on-chain data points to a constructive shift and improving momentum, bitcoin continues to face resistance around $82,000. The asset has rebounded roughly 35% from its February lows near $60,000 but has yet to achieve a decisive breakout.

Moreno also pointed to signs of fatigue in secondary indicators, suggesting the market may need more time to build a sustained uptrend. The situation is further complicated by neutral sentiment readings and an uncertain macroeconomic backdrop.

Some analysts remain optimistic. Arthur Hayes, CIO of Maelstrom and co-founder of BitMEX, believes bitcoin likely established a bottom near $60,000 earlier this year. He views $90,000 as a key level that could trigger a sharper rally toward prior highs around $126,000.

At the same time, experts caution against overreliance on on-chain metrics. Jason Fernandes, co-founder of AdLunam, said indicators like MVRV and NUPL are better suited for understanding broader market behavior and positioning within the liquidity cycle, rather than serving as precise trading signals.