Constancy Digital Property says Bitcoin’s newest drawdown has pushed the market right into a zone that has traditionally aligned with accumulation phases, whilst its momentum sign stays unfavorable and broader crypto danger urge for food stays slim.
In its Indicators Report Q2 2026, Constancy’s analysis crew described a market nonetheless working by means of a corrective section fairly than coming into a broad-based enlargement. Bitcoin stays the dominant supply of unrealized profitability throughout the digital asset complicated, whereas different main belongings proceed to stabilize after a pointy reset in Q1.
Constancy Says Bitcoin Appears Undervalued
The report’s clearest Bitcoin worth sign comes from the asset’s “Yardstick,” a valuation framework that compares Bitcoin’s market capitalization to hash price. Constancy rated the metric constructive, noting that falling costs and a pullback in hash price have pushed the indicator into what it calls an “undervalued” zone.
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“Traditionally, this undervalued zone has aligned with accumulation phases and relative bottoms,” the report said.
In accordance with Constancy, Bitcoin spent 71 of the earlier 91 days, or 78% of the interval, beneath unfavorable one commonplace deviation of the Yardstick’s imply. The situation first appeared in October 2025 and was amplified by two cold-weather occasions in america that quickly curtailed mining exercise as operators decreased energy utilization to assist native grid stability.
That nuance issues. Constancy doesn’t body the hash-rate decline purely as an indication of deteriorating miner confidence. The report stated some analysts have linked the decline to miners shifting toward AI workloads, however argued the transfer may additionally replicate demand-response applications, particularly in areas similar to Texas the place miners routinely energy down throughout peak grid demand.
The value backdrop stays troublesome. Constancy’s momentum sign for Bitcoin turned unfavorable on October 18, 2025, when BTC traded close to $107,000. Since then, Bitcoin has fallen roughly 36%, with most of Q1 2026 spent in an outlined vary between $62,500 and $76,022. The agency stated that sample is extra in step with consolidation than a renewed pattern.
“This sign isn’t designed to determine exact tops or bottoms,” Constancy wrote, including that the present studying factors to stabilization fairly than recent upside momentum.
Bitcoin’s NUPL rating additionally displays a cautious market. Constancy stated BTC’s internet unrealized profit/loss stood at 0.21 on the finish of Q1 2026, putting buyers within the “Hope-Concern” zone. That studying suggests some holders stay in revenue, however the market has not but established broad conviction {that a} sturdy backside is in place.
The historic setup is extra constructive. Constancy discovered that prior intervals when Bitcoin’s NUPL hovered round 0.21, plus or minus 0.01, coincided with a median one-year return of 63% and a three-year compound annual progress price of 74%. The agency emphasised, nonetheless, that these historic relationships could weaken or fail to persist, notably when macro situations dominate digital asset flows.
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Individually, Constancy’s Jurrien Timmer pointed to a extra tactical Bitcoin setup, sharing a chart that reveals BTC testing the higher boundary of what he described as a possible bear flag. The chart locations Bitcoin close to $79,486 after its rebound from the February low round $60,033, with momentum indicators shifting again into overbought territory.
Timmer framed the present setup as an necessary technical take a look at. “Technical Evaluation 101 states that when bear market rallies get overbought, it’s normally the kiss of loss of life and time to promote,” he wrote. “Nevertheless, throughout bull markets overbought momentum implies that the market is powerful and prone to keep robust.”
His conclusion sharpened the worth query raised by Constancy’s broader report: whether or not Bitcoin remains to be trapped in a corrective construction or starting to transition into a brand new bull section. “If Bitcoin can’t be pulled down by this present mixture of overbought momentum and trendline resistance, then that is an rising bull market and never a bear market rally,” Timmer stated, including that this has been his “hunch all alongside” and “could also be about to get confirmed.”
At press time, BTC traded at $76,036.
Featured picture created with DALL.E, chart from TradingView.com
