Bitcoin bottom signal flashes again… similar to the oversold trough seen in 2018

Bitcoin (BTC) on-chain indicators are showing an extreme oversold signal similar to the market bottom during the 2018 bear market, pointing to the possibility of a cycle low.

According to Cointelegraph on the 18th (local time), Checkonchain data from an on-chain analytics platform show that the short-term holder stress metric has fallen to its lowest level since 2018. The metric applies Bollinger Bands to short-term holders’ profitability (MVRV) to gauge the gap between the current price and the average cost basis of recent buyers. Short-term holders refer to wallets that have held BTC for fewer than 155 days.

When the indicator drops below the lower band, it implies Bitcoin is trading well below the average cost basis of recent buyers, beyond the range suggested by statistical volatility. In the past, this signal has coincided with macro bottoms.

After a similar oversold signal emerged in late 2018, Bitcoin rose about 150% within a year and surged roughly 1,900% over three years. The same signal also appeared just ahead of the November 2022 bottom, after which BTC climbed about 700% to an all-time high of around $126,270.

Recent data show that, since the peak near $126,000 in October 2025, realized losses among short-term holder whales have not expanded sharply. This has been interpreted as a sign that large, recent buyers have yet to move into full-scale capitulation.

Some in the market view it as a signal that selling pressure has largely been exhausted. Analysts at firms including digital-asset custody platform Matrixport have also raised the possibility of a similar bottoming process.

Potential improvement in the short-term liquidity backdrop has also been mentioned. A Wells Fargo report cited by CNBC said that if US tax refunds increase in 2026 compared with typical years, as much as $150 billion could flow into equities and the Bitcoin market through late March. If that capital absorbs remaining sell supply, it could support a near-term rebound.

Still, as the indicator is a statistical signal based on historical cases, it cannot be ruled out that outcomes may differ depending on the macro environment and supply-demand conditions.