A bitcoin bull-bear market cycle indicator has moved out of the bearish zone for the first time in about 26 months.

BeInCrypto, a blockchain media outlet, reported on May 12 that the signal is the first early bullish sign since March 2023, and past instances coincided with recoveries after sharp corrections.

A CryptoQuant indicator moved out of the bearish zone this week. After similar signals in 2019 and early 2023, bitcoin extended a recovery trend following steep declines. A 30-day moving average also pointed to improving underlying momentum.

Bitcoin traded at $80,655 as of the time of writing. It fell about 0.6 percent on the day but rose about 13 percent over the past 30 days. It also reclaimed the $78,000 level, where the true market mean and short-term holder cost basis overlap. That zone has previously served as a dividing line between bear and bull markets.

On-chain analyst Checkonchain noted that when bitcoin continues trading above that zone, market structure and investor sentiment often improve together. Some analysis also said it is too early to conclude this signal will immediately lead to a new bull market.

In March 2022, the same indicator briefly turned bullish, but bitcoin hit resistance and extended its downtrend. CryptoQuant analyst Moreno said several indicators are already showing fatigue signals and the current trend is not as clear as a typical early-cycle confirmation phase. He said if the price fails to show a strong follow-through rise, it is slightly more likely to be a local peak than the start of a new bull market.

Exchange reserve flows were also cited as a burden factor. Alphractal's Joao Wedson (주앙 웨드슨) pointed out that the 30-day rate of change in exchange reserves has turned from negative to positive. That means more bitcoin is moving into exchanges rather than out of them.

The next market variable is the U.S. consumer price index for April 2026. The U.S. Bureau of Labor Statistics will release the CPI on May 13 morning before Wall Street opens. Market expectations are 0.7 percent month-on-month and 3.7 percent year-on-year. That is higher than March's 3.3 percent year-on-year.

If inflation comes in higher than expected, expectations for near-term U.S. Federal Reserve rate cuts could weaken, increasing pressure across risk assets. If the figures are lower, they could support this bullish-turn signal and the recent May rebound. The market is watching whether bitcoin can maintain an upward trend above $82,000 and the true market mean.