Reversal or Trap? Experts Say a Bitcoin Indicator Has Exited the Bearish Zone Despite Falling Demand

Published: September 2, 2026 – 10:52 UTC

The Bitcoin indicator has returned to positive territory after eight months of bearish momentum.
To confirm the reversal, the indicator needs to rise to 20–30 in the coming weeks, CryptoQuant believes.
At the same time, apparent demand for bitcoin has declined again, creating the risk of another drop.

The Bitcoin Cycle Momentum indicator has returned to positive territory after eight months of bearish action. According to CryptoQuant, this may signal that the downtrend is nearing its end and that a potential market reversal is forming.

Analysts note that to confirm this signal, the indicator must continue moving higher and reach the 20–30 level in the coming weeks. At the same time, the current market structure remains mixed.

*Bitcoin Cycle Momentum indicator. Data: CryptoQuant.*

STH Lock In Significant Profits

Analyst Darkfost drew attention to the behavior of short-term bitcoin holders. According to his data, in August this group of investors was realizing average profits of up to 15%.

This is higher than during the all-time high period, when the average STH profit was around 11%. The last time such a high level of profitability among short-term holders was seen was in October 2025.

Such profit levels create additional sell-side pressure. According to the analyst, if this pressure is absorbed by demand and bitcoin holds current price levels, STH may gradually reduce profit-taking activity and start holding bitcoin for longer, expecting further upside.

Demand for Bitcoin Is Declining Again

Separately, Darkfost noted a deterioration in the apparent demand metric. It has moved back into negative territory, indicating a noticeable contraction in demand for the leading cryptocurrency over the past few days.

Demand is declining again !

This is somewhat what I was concerned about seeing.

While selling pressure remains consistent, with STHs continuing to realize profits, apparent demand has turned negative again.

This is a sign that demand has declined significantly over the… pic.twitter.com/NM5ViYCxs5
— Darkfost (@Darkfost_Coc) September 2, 2026

As a result, the market is simultaneously facing steady selling pressure from STHs and weakening demand. According to the analyst, without a rebound in demand in the near term, bitcoin could enter a new leg down.

As a reminder, earlier Darkfost explained why bitcoin’s rally needs confirmation.

Сообщение Reversal or Trap? Experts Say a Bitcoin Indicator Has Exited the Bearish Zone Despite Falling Demand появились сначала на INCRYPTED.

Source: Incrypted