On-Chain Data in Action: How to Spot Capital Outflow Signals Before the Bull Market Ends
Conclusion: Capital withdrawal signals at the end of a bull market rely on three key areas – whether smart money is consistently distributing, whether long-term holders are selling their positions, and whether exchanges are receiving large deposits. A single indicator does not guarantee a top, but when all three signal together, the probability of a market reversal rises significantly. Here is a practical four-step tracking process.
Step 1: Monitor exchange inflows – whale deposits are the most direct sell pressure signal
When large amounts of coins move from on-chain wallets to exchanges, it usually means holders are preparing to sell. This is the most straightforward metric for assessing short-term sell pressure.
How to do it:
- Open CryptoQuant, search for the target coin + "Exchange Inflow" or "Netflow".
- Monitor whether daily inflows breach historical thresholds.
Current reference: CryptoQuant shows daily Bitcoin exchange inflows have surpassed 50,000 BTC, Ethereum has broken 1,250,000 ETH, and altcoin deposit volumes reached a two-month high. Historically, inflows at this level have been accompanied by sell pressure and sharp price volatility.
Completion criteria: Be able to tell whether current exchange net inflows are in a historically high, medium, or low range. Several consecutive days well above the average are a warning sign.
Step 2: Track long-term holder behavior – when they stop accumulating, it's a precursor to a top
Long-term holders (addresses holding coins for over 155 days) represent the most steadfast supply in the market. When this cohort shifts from accumulation to distribution, it often signals a cycle turning point.
How to do it:
- On Glassnode, check the "Long-Term Holder Net Position Change" indicator.
- Observe whether the 30-day net change is positive (accumulation) or negative (distribution).
Current status:
- Recently, long-term holders have returned to a net accumulation state, in the range of about 50,000–100,000 BTC.
- However, the accumulation pace is far below the 400,000 BTC level seen during the peak of the previous bull market, indicating a moderate stance.
- The largest whale cohort (>10,000 BTC) remains near neutral (score 0.4–0.5) and is not buying aggressively.
Key judgment: If the long-term holder net position turns negative again in the future and continues to expand, it is a clear signal that capital is withdrawing. This scenario has not yet materialized, but it requires continuous monitoring.
Completion criteria: Be able to judge whether long-term holders are currently accumulating or distributing, and whether the scale is "moderate" or "extreme".
Step 3: Check MVRV Z-Score – whether the market is overheated
MVRV Z-Score measures how far the current price deviates from the average cost basis of all holders. It is a core indicator for gauging whether the market is in a "value zone" or a "bubble zone".
Meaning of each range:
| Z-Score Range | Meaning |
|---|---|
| < 0 | Severely undervalued – historically corresponds to bottom areas |
| 0–3 | Fair value or slightly overvalued |
| 3–5 | Elevated – should be combined with other indicators |
| 7–10 | Extremely overvalued – historically aligns with bull market tops |
Current data: In mid-2026, the Z-Score is around 0.9–1, still in a relatively moderate position, far from touching historical top levels.
Completion criteria: Record the current Z-Score value and identify which range it falls into. If the reading starts to race toward 7 or higher, that is the clearest warning signal.
Step 4: Combine multiple indicators – a single signal is not enough
The most reliable signal at the end of a bull market is not a single indicator, but multiple dimensions flashing red at the same time. Judge the market by combining the following indicators:
| Indicator | Warning Threshold (Historical Reference) |
|---|---|
| Exchange daily net inflow | Sustained significantly above average (e.g., BTC > 50,000/day) |
| LTH net position | Sustained shift to net distribution with expanding scale |
| MVRV Z-Score | 7–8 |
| NUPL | 0.75 ("Extreme Greed" zone) |
| Puell Multiple | 4.0 |
If 2–3 of these indicators trigger their thresholds at the same time, the probability of a market reversal rises significantly.
Completion criteria: Cross-verify at least three indicators and determine whether the market is in a "late bull" phase or "topping out".
Common Misconceptions and Risk Reminders
- "Whale deposits = immediate price crash": Coins flowing into an exchange do not mean an immediate sell-off; sometimes they are for market-making or hedging. Still, consecutive large deposits are usually worth paying attention to.
- "LTH accumulation = immediate price surge": Current LTH accumulation is modest, and the largest whales have not yet joined in. A full accumulation trend has not been confirmed. This is a positive change, not a reversal confirmation.
- Do not rely on a single indicator alone: In the 2026 data, long-term holders have turned to accumulation, but the market is still in a late bottoming phase, and selling pressure from long-term holder stop-losses persists. This shows that when indicators contradict each other, a holistic judgment is necessary.
Next steps: Open CryptoQuant and add the BTC exchange net inflow and long-term holder net position charts to your watchlist first. Check them once a week to see if the direction of these two core indicators is changing. When exchange inflows keep surging and LTHs start distributing in tandem, that is the real alarm — until then, staying observant is far more useful than acting prematurely.
