Blockchain analytics firm CryptoQuant has published a new on-chain analysis showing that Bitcoin’s downturn from its peak could be anticipated weeks in advance by monitoring key demand indicators. According to their “Apparent Demand Growth” metric, Bitcoin’s slide from its October 2025 high of $126,000 to today’s $70,000 level unfolded in six clear stages on the blockchain before the decline became apparent in price action.
Six Stages of Declining On-Chain Demand
The analysis carefully traces out the shifts in Bitcoin demand following the cryptocurrency’s cyclical peak. In the initial stage, with the market still on the rise, the apparent demand growth metric posted its last higher low at $118,000. At that point, upward momentum in demand was intact, and price charts showed no obvious indication of an impending top.
In the second stage, Bitcoin chalked up its all-time high at $126,000, and the demand metric surged to its own peak simultaneously. Demand and price signals were in perfect alignment during this phase, strengthening the bullish outlook.
The third step marked the beginning of a divergence. The apparent demand growth metric fell below its previous higher low, dipping to $123,000. This signaled the first cracks in the upward trend: while price remained lofty, on-chain data suggested the bullish momentum was faltering.
By the fourth stage, as Bitcoin retreated to $114,000, the demand metric had taken on a firmly bearish structure–recording lower highs and lower lows, a classic indication that the trend had reversed. Yet at this point, Bitcoin’s price still hovered above the $110,000 threshold.
Stage five coincided with Bitcoin easing down to $101,000. With each successive lower high in the demand data, the price responded with a gradual, stepwise downturn. The trend of dwindling demand persisted for several weeks, foreshadowing the price slippage.
The sixth and final stage culminated on November 16, when Bitcoin dipped to $94,000 and fell below its 50-day simple moving average (SMA50) on the weekly chart. Analysis found the SMA50 had already lost its upward trajectory; both demand and price action were flagging notably. This intersection was pinpointed as a critical on-chain signal to take action, framed within CryptoQuant’s method.
Practical Applications of On-Chain Rules
The methodology and its visualizations are anchored in what CryptoQuant calls the “On-Chain Candlestick Rule.” According to this approach, if the demand indicator breaks its bullish structure shortly after a price peak, taking profits and monitoring for further confirmations in other price or on-chain signals is seen as a prudent strategy.
The analysis notes that each stage of the six-step process provided earlier warning than the previous one. Investors who tracked the apparent demand growth metric in real time had repeated opportunities to adjust risk exposure before the decline was complete. Analysts highlighted that the shift was not sudden but played out over several weeks, allowing for multiple decision points.
Current Outlook and Market Scenarios
Currently, the apparent demand growth metric has dropped sharply in recent months and is now approaching the lower band of its index. Whether this represents a bottom similar to the accumulation phase before the 2025 rally, or a structurally weaker situation compared to previous cycles, remains in question and is closely watched by market participants.
CryptoQuant’s report also draws attention to the length of the decline. The entire deterioration of on-chain demand developed over months, mirroring the slow and gradual rebounds of prior cycles, where recovery in demand indicators unfolded in a similar stepped process.
