📢 Flash
Analysis: BTC’s cyclical recovery logic remains unshaken; losses and panic have been fully exhausted.
On November 8, market analyst Murphy published an article analyzing the question: “Will BTC re-enter a bear market?” Using the Realized Profit/Loss Ratio Momentum (RPLR-M) indicator as his foundation, he noted that—on an entity-level basis—this metric effectively captures phases where the profit/loss ratio accelerates upward or downward, making it highly indicative of trend inflection points. When viewed over longer timeframes, three features carry the greatest interpretive weight: (1) the duration of time spent in the red or green zones; (2) whether the peak of the top green line shows a declining trend; and (3) whether the trough of the bottom red line progressively narrows.
In early-stage bear markets, the red-line trough typically hits its lowest point—reflecting accelerating losses. Subsequently, even as price makes new lows, the trough begins narrowing, signaling that the next leg down is failing to trigger panic selling of comparable intensity. Finally, when the indicator “turns green,” the full bear cycle is considered complete. Historically, this process lasted roughly 14 months from 2018–2019 and about 13 months from 2021–2023; the current cycle has now run for approximately 11 months. Given both the elapsed timeframe and the consistent narrowing of the red-line trough since its initial bottom, the market has already fully absorbed loss accumulation and emotional exhaustion—aligning precisely with the textbook evolution of a cyclical bear market.
Murphy emphasized a critical historical observation: In every prior instance where the indicator turned green into Zone B, there was *no case* of it reverting back to Zone A and restarting a full bear cycle. While brief “red flashes” occasionally occur within Zone B, they tend to be short-lived—and are consistently accompanied by diminishing peaks in the green line, indicating slowing acceleration in realized profits. Therefore, he remains unconvinced by concerns that a U.S. equity market crash would drag BTC to new lows.
Additionally, the analyst pointed out that BTC’s correlation with U.S. equities has now reached 0.8—approaching its highest level since 2020. By mean-reversion logic, such elevated correlation is statistically likely to decline after hitting a certain threshold. If the one-way negative linkage persists long-term—i.e., BTC falls when equities rise *and* falls when equities fall—the rationale for long-term holders continuing to accumulate ~14 million BTC instead of reallocating entirely into U.S. equities would eventually become unsustainable.
Just as Rome wasn’t built in a day, BTC’s evolution isn’t linear either—each wave of panic, each round of position turnover, and each phase of confidence rebuilding quietly accumulates energy for the next trend leg. Of course, historical patterns aren’t guarantees of future outcomes; macro uncertainty remains, and BTC could still experience sudden, sharp volatility. Yet based on current data, there is no compelling evidence to overturn the baseline thesis of a cyclical recovery underway.
In early-stage bear markets, the red-line trough typically hits its lowest point—reflecting accelerating losses. Subsequently, even as price makes new lows, the trough begins narrowing, signaling that the next leg down is failing to trigger panic selling of comparable intensity. Finally, when the indicator “turns green,” the full bear cycle is considered complete. Historically, this process lasted roughly 14 months from 2018–2019 and about 13 months from 2021–2023; the current cycle has now run for approximately 11 months. Given both the elapsed timeframe and the consistent narrowing of the red-line trough since its initial bottom, the market has already fully absorbed loss accumulation and emotional exhaustion—aligning precisely with the textbook evolution of a cyclical bear market.
Murphy emphasized a critical historical observation: In every prior instance where the indicator turned green into Zone B, there was *no case* of it reverting back to Zone A and restarting a full bear cycle. While brief “red flashes” occasionally occur within Zone B, they tend to be short-lived—and are consistently accompanied by diminishing peaks in the green line, indicating slowing acceleration in realized profits. Therefore, he remains unconvinced by concerns that a U.S. equity market crash would drag BTC to new lows.
Additionally, the analyst pointed out that BTC’s correlation with U.S. equities has now reached 0.8—approaching its highest level since 2020. By mean-reversion logic, such elevated correlation is statistically likely to decline after hitting a certain threshold. If the one-way negative linkage persists long-term—i.e., BTC falls when equities rise *and* falls when equities fall—the rationale for long-term holders continuing to accumulate ~14 million BTC instead of reallocating entirely into U.S. equities would eventually become unsustainable.
Just as Rome wasn’t built in a day, BTC’s evolution isn’t linear either—each wave of panic, each round of position turnover, and each phase of confidence rebuilding quietly accumulates energy for the next trend leg. Of course, historical patterns aren’t guarantees of future outcomes; macro uncertainty remains, and BTC could still experience sudden, sharp volatility. Yet based on current data, there is no compelling evidence to overturn the baseline thesis of a cyclical recovery underway.
