Woofun AI reports that Bitcoin unspent transaction outputs (UTXOs) reveal a capitulation pattern historically aligned with bear market bottoms. CryptoQuant analyst Darkfost stated on Saturday that the ratio of UTXOs spent in profit versus at a loss has dropped to its lowest point in the current cycle. This metric triggered for the first time since the correction began, signaling that loss-making transactions are reaching significant volumes and marking the onset of broader capitulation. The data suggests markets are entering a bottoming phase, presenting a strategic window for accumulation. The last instance of such a low ratio occurred in mid-2023 during the previous bear market depths when BTC prices hovered near $26,000. Darkfost noted that these periods have consistently proven profitable for long-term investors, corresponding to moments when the majority surrenders interest. He cautioned that this process unfolds over a long timeframe.

Analyst DurdenBTC confirmed the signal on Saturday, noting it has identified every cycle low since 2016. He emphasized that while the bottom signal has fired, the market will likely remain distressing for weeks. DurdenBTC argued that if buying at this level were comfortable, the signal would not exist. In a separate analysis, Darkfost reinforced these findings by observing that long-term holders are entering a capitulation phase as the Spent Output Profit Ratio (SOPR) shifts into negative territory for this cohort.

However, he attributed the current correction largely to rapid BTC inflows to exchanges driven by short-term holders rather than long-term selling pressure.

Swissblock, an onchain analytics firm, stated on Saturday that Bitcoin has likely moved past the initial breakdown but remains in a base formation phase.

Woofun AI data shows that external geopolitical factors may exacerbate uncertainty and selling pressure. US fighter jets conducted strikes on 10 Iranian military targets near the Strait of Hormuz late Saturday following an Iranian drone attack on a commercial ship. These resumed military actions could intensify market volatility in the coming days. BTC prices dipped to $59,800 in early Sunday trading but recovered to the $60,100 level by the time of writing. This marks a critical juncture where technical signals and geopolitical risks intersect.