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Bitcoin Bounces Off Historic “Mayer Multiple” Bottom Zone

Data shows the price of Bitcoin has broken above the 0.55 Mayer Multiple level, below which the crypto has historically formed bottoms.

Bitcoin Has Now Left The Zone Below 0.55 Mayer Multiple

As per the latest weekly report from Glassnode, the BTC price has escaped above the Mayer Multiple bottom zone.

The “Mayer Multiple” is an indicator that measures the ratio between the current Bitcoin price and the 200-day moving average of the same.

A “moving average” (or MA in brief) is an analytical tool that takes the average of any quantity over a specified period, and as its name implies, it moves with the quantity and changes its value accordingly.

MAs are quite useful in studying long-term trends as they eliminate any short-term fluctuations and smooth out the curve.

Related Reading | Bitcoin Puell Multiple Lifts Off From Buy Zone, Bull Momentum To Follow?

The Mayer Multiple basically tells us how the latest value of the crypto has deviated from the average during the past 200 days. Based on this, it becomes possible to say whether the coin is currently overbought or oversold.

Now, here is a chart that shows the trend in the Bitcoin “Mayer Multiple = 0.55” line during the last several years:

Looks like the price of the coin has crossed above the level recently | Source: Glassnode’s The Week Onchain – Week 30, 2022

As you can see in the above graph, the the price of Bitcoin was under a Mayer Multiple value of 0.55 until very recently.

At this value of the indicator, the BTC price is trading 45% lower than the 200-day average. Historically, cyclical bottoms in the crypto’s price have formed under this level.

Related Reading | On-Chain Data: Bitcoin Whales With 10k+ BTC Have Been Growing

This zone with Mayer Multiple values less than 0.55 has been rarely observed, with the crypto closing under it on a total of 127 days out of the 4186 days of trading life for the coin. This means that BTC has only spent 3% of its history in this region.

Currently, it seems like Bitcoin is now shooting above the level after spending some time below it recently. If the past is anything to go by, this could mean that a bottom is now in for the crypto as the worst of the bear market may be over.

BTC Price

At the time of writing, Bitcoin’s price floats around $20.9k, down 5% in the last seven days. Over the past month, the crypto has lost 2% in value.

The below chart shows the trend in the price of the coin over the last five days.

The value of the crypto seems to have been going down over the last few days | Source: BTCUSD on TradingView
Featured image from Kanchanara on Unsplash.com, charts from TradingView.com, Glassnode.com

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Bitcoin NUPL Shows Average Holder Back In Profit, But For How Long?

On-chain data shows the Bitcoin NUPL metric is back to a positive value, suggesting the market as a whole is back in profit.

Bitcoin NUPL Latest Trend Could Signal The Bottom Is Already In

As pointed out by an analyst in a CryptoQuant post, the BTC NUPL breaking above the neutral market may be a sign that the bottom has set in.

The “Net Unrealized Profit/Loss” (or “NUPL” in short) is an indicator that’s defined as the difference between the market and realized caps, divided by the market cap.

In simpler terms, what this metric tells us is the profit/loss ratio among investors in the current Bitcoin market.

The indicator works by looking at the on-chain history of each coin to see what price it was last moved at. If this selling price of any coin was less than the current BTC value, then that particular coin is holding some profit right now. Otherwise, it is in loss at the moment.

Related Reading | Capitulation: Public Bitcoin Miners Dump 25% of BTC Holdings Last Month

When the value of the NUPL is greater than zero, it means investors in the Bitcoin market as a whole are in profit. On the other hand, the indicator’s value being negative implies the overall market is currently in a state of loss.

Now, here is a chart that shows the trend in the BTC NUPL over the last several years:

The value of the metric seems to have surged up in recent days | Source: CryptoQuant

As you can see in the above graph, the quant has marked the relevant zones of bear market trend for the Bitcoin NUPL.

It looks like some time after plunging deep below zero, a bounce back to positive values has been a sign of bottom formation during the previous bear markets.

Currently, the indicator is back to a positive value after observing a surge recently. This means that the investors as a whole are slightly in profit right now.

If the past cycles are anything to go by, this trend could imply the bottom has already been in for this Bitcoin bear market.

However, as is apparent in the chart, a break to green NUPL values doesn’t necessarily mean the end of the bear. It has only indicated that the crypto has already faced the worst.

Related Reading | Tesla Ruins Bitcoin Rally? Musk’s Company Sold 75% Of Its BTC

Past bear markets have lasted for much longer than the current one so it’s possible that if a similar pattern follows, the market may drop back into loss and move sideways for a while, before a proper bullish momentum builds up.

BTC Price

At the time of writing, Bitcoin’s price floats around $22.6k, up 10% in the past week.

BTC has slumped down during the last 24 hours | Source: BTCUSD on TradingView
Featured image from Kanchanara on Unsplash.com, charts from TradingView.com, CryptoQuant.com

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Bitcoin Rally As Altcoins Turn Green, Pushes Market Above $1 Trillion Threshold

Following strong weekly double-digit gains from Bitcoin and a number of big-cap altcoins, the cryptocurrency market capitalization surpassed $1 trillion.

$1 Trillion Market Crossed Again

For the first time since June 13, a significant gain on Monday in both bitcoin and ether helped lift the market worth of cryptocurrencies back beyond the $1 trillion level.

The largest cryptocurrency has reached its highest prices since a selloff in mid-June brought the price of bitcoin down from $30,000 to as low as $18,000, rising 5% in the last 24 hours to $22,300.

During the late 2017 bull market surge for bitcoin, that same level served as a strong region of resistance, and in technical analysis, old resistance typically turns into new support (and vice versa).

Crypto market cap above $1 trillion threshold. Source: TradingView

For cryptocurrency investors, Monday’s profits should come as a relief after the preceding nine months have seen them endure a terrible bear market. As a result of the prolonged bear market in cryptocurrencies, $2 trillion in market value has been lost, and several crypto companies, including Celsius, Voyager Digital, and Three Arrows Capital, have gone bankrupt.

Despite analyst predictions that the Federal Reserve would increase interest rates by at least 75 basis points at the Federal Open Market Committee meeting on July 27, the traditional markets are mildly higher on the day that cryptocurrencies are generally in the black.

While traders may like the uptick in price on July 18, several analysts warn that it is merely a bear market pump.

Related Reading | Bitcoin Bearish Signal: Exchange Netflows Spike Up

Bitcoin Poised For Rebound

According to TradingView data, Bitcoin has made considerable gains over the past week. At the time of writing, BTC had risen by 16 percent from its most recent low of $18,907.

The most valuable cryptocurrency is currently bumping up into resistance at the 200-week moving average, which also happens to be the top of the trading range that BTC has been stuck in since the middle of June.

Over the past five weeks, attempts to break above this level have been repeatedly rejected, proving it to be a difficult nut to crack. It is yet unclear whether Bitcoin will be able to overcome this barrier and climb higher or if it will continue to fluctuate between $19,000 and $22,000.

The major distinction between the present bear market and previous cycles, according to Glassnode’s most recent newsletter, is “duration” and many on-chain measures are now comparable to these historical drawdowns.

Realized price, which is calculated as the value of all Bitcoin divided by the quantity of BTC in circulation, has shown to be a good indicator of bear market bottoms.

Number of days Bitcoin price traded below the realized price. Source: Glassnode

With the exception of the flash crash in March 2020, which is depicted on the above chart, Bitcoin has consistently traded below its realized price for a protracted period of time throughout bear markets.

Glassnode explained:

“The average time spent below the Realized Price is 197-days, compared to the current market with just 35-days on the clock.”

Related Reading | Bitcoin Breaks Above Realized Price Again, Bottom Finally In?

Featured image from Getty Images, charts from TradingView.com

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Bitcoin Breaks Above Realized Price Again, Bottom Finally In?

Data shows Bitcoin has broken above the realized price once again as the crypto surges to $22k. Will the recovery hold this time?

Bitcoin Makes 2nd Attempt To Break Above Realized Price In 10 Days

As pointed out by an analyst in a CryptoQuant post, BTC may be finally shooting above the realized price again after spending 33 days below the level in total.

To understand what the “realized price” is, it’s best to first take a look at a quick explanation of the two main capitalization methods for Bitcoin.

The “market cap” is calculated by multiplying each coin in circulation right now with the current BTC price, and taking the total sum (or more simply, it’s just the total number of coins multiplied by the price).

Where the “realized cap” differs is that, instead of taking the same one price for all, it rather weighs each coin against the value of BTC at which the particular coin was last moved/sold.

Related Reading | Bitcoin Bearish Signal: Exchange Netflows Spike Up

For example, suppose the current Bitcoin price is $22k and there are two coins in circulation. If one of these last moved at $22k while the other at $15k, then the market cap will be $44k, but the realized cap will be $37k.

Now, the realized price is measured by just dividing the realized cap by the total number of coins in circulation. The below chart shows the trend in this metric over the past month:

Looks like the BTC price is crossing over the metric’s line | Source: CryptoQuant

As you can see in the above graph, the value of Bitcoin very briefly spiked above the realized price around ten days ago, before slamming down again,

Historically, late stage bear markets have lasted while the price of the crypto has remained below the metric’s line, with it acting as resistance.

Related Reading | Bitcoin Funding Rate Turns Highly Positive, Long Squeeze In The Making?

Today, BTC has once again shot up above the realized price curve, but it’s yet to be seen whether this time the recovery will last. If it does, then it could mean the bear bottom for the current cycle might be in.

Ignoring the brief spikes above the level, Bitcoin has now spent 33 days under the realized price so far. During 2015, the crypto was 9 months under this level, while in 2018 it was for a quarter of a year.

BTC Price

At the time of writing, Bitcoin’s price floats around $22k, up 8% in the last seven days. Over the past month, the crypto has gained 8% in value.

The price of the coin seems to have surged up over the past day | Source: BTCUSD on TradingView
Featured image from Maxim Hopman on Unsplash.com, charts from TradingView.com, CryptoQuant.com

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Bitcoin Long-Term Holder Capitulation Approaching Bottom Zone, But Not Quite There Yet

On-chain data shows Bitcoin long-term holder capitulation has deepened recently, but has not entered into the historical bottom zone yet.

Bitcoin Long-Term Holder SOPR Continues To Observe Deep Values Below ‘1’

As explained by an analyst in a CryptoQuant post, BTC long-term holders have been realizing losses in recent weeks.

The “spent output profit ratio” (or SOPR in short) is an indicator that tells us whether Bitcoin investors are currently selling at a profit or at a loss.

The metric works by checking the on-chain history of each coin being sold to see what price it was last moved at. If this last selling value of any coin was less than the current BTC price, then that coin has now been sold at a profit.

Related Reading | Can This Bitcoin Ratio Have Hints For A Bottom?

On the other hand, the previous price being more than the one right now would imply the coin has realized some loss.

When the SOPR is greater than one, it means the overall Bitcoin market is harvesting some profits at the moment. On the contrary, a value less than that implies loss realization is going on among BTC investors right now.

“Long-term holder” group includes all BTC investors that held their coins for at least 155 days before selling or moving them. The below chart shows the trend in the 14-day MA SOPR specifically for these LTHs:

The value of the metric seems to have been going down recently | Source: CryptoQuant

As you can see in the above graph, the quant has marked all the relevant points of trend for the 14-day MA Bitcoin long-term holder SOPR.

It seems like the major bottoms in the history of the crypto were formed whenever the indicator’s value sank to a value of around 0.48 (denoted by the green line in the chart).

Related Reading | $15k Possible Bottom For Bitcoin? “Delta Cap” Says So

This kind of value occurs when LTHs go into deep capitulation. Since this is the BTC cohort least likely to sell at any point, large loss realization from them can signal that the bear bottom is coming near.

Currently, the indicator is also below 1, but it still has a value of about 0.62, a bit higher than the historical bottom zone. This would suggest that while Bitcoin may be heading towards a bottom, it’s not quite there yet.

BTC Price

At the time of writing, Bitcoin’s price floats around $19.4k, down 9% in the past week. The below chart shows the trend in the value of the crypto over the last five days.

Looks like the price of the coin has been moving sideways over the last few days | Source: BTCUSD on TradingView
Featured image from Brent Jones on Unsplash.com, charts from TradingView.com, CryptoQuant.com

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Can This Bitcoin Ratio Have Hints For A Bottom?

Past trend of the Bitcoin actual/realized price ratio may be forming a pattern that could hint at a possible bottom for the crypto at $17k.

Bitcoin Actual/Realized Price Ratio Currently Has A Value Of 0.8

As pointed out by an analyst in a CryptoQuant post, historical data of this BTC ratio may have interesting implications for the current market.

The realized cap is a capitalization model for Bitcoin that multiplies each coin in the circulating supply with the price at which the coin was last moved and takes the sum of all the values. This is different from the usual market cap, where the entire supply is simply multiplied by the current price of BTC to get the capitalization.

Now, from this realized cap, a “realized price” can also be obtained by dividing the metric with the total amount of coins in circulation.

Related Reading | New Bitcoin Record Paints Incredibly Bearish Picture As BTC Struggles At $19,000

The “actual/realized price ratio” is, therefore, an indicator that measures the ratio between the normal price of BTC and this new realized price.

Here is a chart that shows the trend in this Bitcoin ratio over the last few years:

Looks like the actual price is lesser than the realized one at the moment | Source: CryptoQuant

In the above graph, the quant has highlighted the major bottoms during previous Bitcoin cycles and the value of the actual/realized price ratio at which they occurred.

Looking at the chart, it seems like during the 2015 bottom, the value of the indicator was about 0.6. And in the 2018 bottom, it was about 0.67.

Related Reading  | Why Bitcoin Could Collapse Another 50%, Says Michael “Big Short” Burry

Currently, the metric has a value of 0.8, which means the price of the crypto is around 80% of the realized price right now.

If there is a pattern here with the actual/realized price ratio, then the bottom this time may also form at a value 0.07 higher than the previous time.

This would put the ratio at about 0.74, which implies Bitcoin will need to decline further until $17k before this “bottom” value is reached.

Naturally, this would only happen if there really is such a pattern present here. Another indicator, the delta capitalization model, suggests that $15k could be a possible lower bound for a Bitcoin bottom.

BTC Price

At the time of writing, Bitcoin’s price floats around $19.2k, down 10% in the last seven days. Over the past month, the crypto has lost 35% in value.

The below chart shows the trend in the price of the coin over the last five days.

The value of the crypto seems to have been going down over the last couple of days | Source: BTCUSD on TradingView
Featured image from Michael Förtsch on Unsplash.com, charts from TradingView.com, CryptoQuant.com

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$15k Possible Bottom For Bitcoin? “Delta Cap” Says So

The “delta capitalization” model of Bitcoin may suggest that around $15k could be a possible bottom for the crypto’s price.

Past Delta Cap Trend Shows Bitcoin May Still Face More Decline Before A Bottom

As explained by an analyst in a CryptoQuant post, the BTC market cap is now below the realized cap, but still above the delta cap.

Before taking a look at the data, it’s best to first get a basic grasp of the three major capitalization models for Bitcoin.

The normal market cap is calculated by just taking the total number of coins currently in circulation and multiplying it by the price of BTC right now.

The “realized cap” works a bit differently; instead of multiplying all the coins by the same price, this model weighs each coin by the price it was last moved at.

Related Reading | USDC Exchange Reserves Rise As Investors Escape From Bitcoin

For example, if there are 2 BTC in circulation and the current price is $19k, then the normal market cap is simply $38k. However, if one of these coins was last transacted at, say, $15k, and the other at $19k, then the realized cap would be $34k instead.

Now, the Bitcoin “delta cap” is defined as the difference between the realized cap and the average of the market cap. The average of the normal market cap here is taken over the entire history of the crypto (and it’s naturally a moving average).

The below chart shows the trend in the different market caps for BTC.

The normal market cap still seems to be above the delta cap at the moment | Source: CryptoQuant

As you can see in the above graph, the Bitcoin market cap has recently dipped below the realized cap. However, it has still not gone down near enough to touch the delta cap.

Historically, the value of the crypto has formed bottoms whenever the market cap has been between the other two caps.

Related Reading | Fed Announces Inflation Warnings As Bitcoin Whales Remain In Wait Mode

In 2020, the coin bottomed out after the market cap went slightly under the realized cap, but in 2018 the metric even dipped a bit below the delta cap before the bottom was in.

This past trend may suggest that the point around the delta cap may be the possible lower bound for how deep the coin’s price can sink. And if so, then Bitcoin could potentially sink to or a little under $15k, before the current cap touches the delta cap and the bottom forms.

BTC Price

At the time of writing, Bitcoin’s price floats around $19.3k, down 9% in the past week.

BTC has gone down over the last few days | Source: BTCUSD on TradingView
Featured image from Dmitry Demidko on Unsplash.com, charts from TradingView.com, CryptoQuant.com

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Bitcoin Bounces Back Before Hitting 2017 Peak, Is The Bottom In?

The price of bitcoin had dropped dangerously close to the 2017 cycle peak on Wednesday. It was a brutal decline for investors who watched their BTC portfolios incur losses after losses. Speculations were rampant in the space on what a touch below $20,000 would have meant for the market. The implications were abundant in their impact but the recovery back above $21,000 has staved off the bears, if only for a little while.

Is The Bitcoin Bottom In?

After the market recovery on Wednesday, it has become apparent that there has been some intervention in the market crash. With bitcoin in the $20,000 level, many had resigned to the fate that there would be no respite until the 2017 high levels were broken. If this had happened, it would have marked a first-of-its-kind event in the history of bitcoin where the digital asset had always managed to never trade below previous cycle peaks. 

Related Reading | Bitcoin Crash Sends Institutional Investors Running For The Hills

As such, significant support forming right above $20,000 has restored some hope in the market that this would be the bottom. So far, this theory has managed to hold as bitcoin has turned back into the green for the first time since the crash began.

More importantly, though is the fact that the recovery has not been significant by any measure. The digital asset still remains well below its 20-day moving average, a sign that bears can easily take hold once more. 

BTC decline triggers fear of hitting previous cycle peak | Source: BTCUSD on TradingView.com

However, bitcoin is said to be at oversold levels. So, the market expects to see fatigue in the sell-offs that have been rocking the digital asset. A slowdown would definitely be good for bitcoin but it would need to see more recovery to ensure this.

Implications Of Falling Below $20,000

The $20,000 level is important for bitcoin to hold for a number of reasons. One of the most major of these are the MicroStrategy bitcoin-backed loans. The way these loans are structured leave open a margin call opportunity if BTC to fall below its previous peak cycle. And although CEO Michael Saylor has assured the market that the firm has more collateral to put towards its loan to avoid a margin call disaster, it remains a very real possibility.

Related Reading | Double-Digits Losses Are The Order Of The Day As Bitcoin Declines To $20,000

Another implication is the Celsius liquidity levels. Now, the first is said to have paid off some of its loans which had pushed its liquidation price back to $14,000 but a break below $20,000 shows no significant support and would quickly see the lending protocol liquidated.

Last but not least is the fact that bitcoin at $20,000 represents an important technical and psychological level. Given that the majority of BTC-denominated open interest are all at the $20,000 level, a break below this would see renewed sell-offs from investors. 

The only major support after this level is at $16,000, after which, it falls to $14,000, the Celsius liquidation price. However, if bitcoin is able to recover above $25,000 by the end of the week, a test of the $29,000 resistance point would quickly follow.

Featured image from Listverse, chart from TradingView.com

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Has Bitcoin Hit Bottom Yet? Here’s What On-Chain Data Says

Bitcoin continued to crash down yesterday, with the coin hitting as low as $21k before rebounding to current values. Has the crypto made the bottom yet?

Bitcoin NUPL Indicator Assumes Negative Values For First Time Since 2020

As pointed out by an analyst in a CryptoQuant post, the NUPL metric has declined below zero, which could be a sign that the crypto may be approaching a bottom.

The Bitcoin “net unrealized profit and loss” (NUPL) is an indicator that’s defined as the difference between the market cap and the realized cap, divided by the market cap.

In simpler terms, what this metric tells us is whether the overall market is currently holding an unrealized profit or a loss.

When the NUPL’s value is greater than zero, it means the investors as a whole are in a state of profit at the moment.

On the other hand, values of the metric less than zero imply the Bitcoin market as a whole is now holding an unrealized loss.

Now, here is a chart that shows the trend in the BTC NUPL over the last few years:

The value of the indicator seems to have plunged down recently | Source: CryptoQuant

As you can see in the above graph, the Bitcoin NUPL has sharply decreased in value over the past couple of days as the price of the crypto has observed a crash.

The indicator now has a negative value, suggesting that the overall BTC market is now holding some unrealized loss.

Related Reading | Bitcoin Long-Term Holders Realize March 2020-Like Losses As BTC Crashes

The last time the indicator dropped this low was back in March 2020, following the crash caused by the onset of COVID-19.

Historically, Bitcoin has approached a bottom whenever the NUPL metric has reached a negative value of around 0.2.

This is because as the indicator decreases further in value, investors start going deeper into red, and the motive to sell starts dying down.

Related Reading | Bitcoin Weekly RSI Sets Record For Most Oversold In History, What Comes Next?

While the Bitcoin NUPL has now gone below zero, the metric’s value is still larger than it was during the previous bottoms.

So, if a similar trend as those past instances follows now as well, then BTC may have room to decline further still before the bottom is in.

BTC Price

At the time of writing, Bitcoin’s price floats around $22k, down 33% in the last seven days. Over the past month, the crypto has lost 27% in value.

The below chart shows the trend in the value of the coin over the last five days.

The price of BTC has crashed down over the last few days | Source: BTCUSD on TradingView
Featured image from Unsplash.com, charts from TradingView.com, CryptoQuant.com

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Bitcoin Recovers Above $30,000, Has The Bottom Been Marked?

Bitcoin has now started another recovery trend that has seen it mark its position above $30,000 once more. This is a welcome development after the market had seen various crashes that have sent investors into a panic. However, while investors heave a sigh of relief as the digital asset has begun to recover, other concerns have arisen in the market, including if the uptrend will continue and if bitcoin has already seen the bottom of this crash.

Did It Mark The Bottom?

The recent comeback has indicated that bitcoin has either marked the bottom of the dip or may be well on its way to posting further losses. But there remain some indicators that show that maybe indeed, the bottom has been reached.

One of these has been that the Bitcoin RSI remains in the firmly oversold territory. Now, with this indicator in this region, there is not much that sellers can do to bring the price of the digital asset further down, especially with the powerful recovery that was just recorded. 

Related Reading | Bitcoin Funding Rates Remain Unmoved Despite Plunge To $30,000

Even after falling below $25,000 for the first time in more than a year, bulls had not completely relinquished control of the market to their bearish counterparts. What this shows is that bitcoin had likely reached its bottom when it touched the $24,000 and the strength displayed to bounce off from this point suggests that there is a bit of momentum left to carry it further.

BTC price recovers above $30,000 | Source: BTCUSD on TradingView.com

Coincidentally, the digital asset has now turned green on the 5-day moving average. This indicator may not pack as much of a punch as its 50-day counterpart but still indicates returning bullish sentiment among investors. If this continues, and the bottom has in fact been marked at $24,000, then recovery towards the $35,000 may be imminent.

Bitcoin Outflows Grow

Outflows from centralized exchanges for bitcoin had been on the rise when the price of the digital asset had been falling. This would prove to only be a temporary problem though as the outflows had begun to take over inflows once more.

For the past 24 hours, the outflows from centralized exchanges had reached as high as $3.5 billion. This surpassed inflow volume by at least $190 million for the same time period.

Related Reading | How Long Will The CryptoWinter Last? Cardano Founder Provides Answers

What this indicates is that investors are once again beginning to take advantage of the low prices that presented themselves during the crash. Accumulation trends like these are usually expected when the value of an asset is slashed in such a short amount of time. 

Outflows from centralized exchanges recorded for the period of May 11th and 12th came out to about 168,000 BTC, a significant amount given the current bear trend. Although BTC continues to flow into exchanges, long-term investors seem to be taking advantage of these cheaper prices.

Featured image from BBC, chart from TradingView.com

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Bitcoin SOPR Suggests Market Nowhere Near The Bottom

According to on-chain data, current Bitcoin SOPR trend suggests the market may be nowhere near the price bottom.

Bitcoin SOPR Still Some Distance Above The “One” Level

As pointed out by an analyst in a CryptoQuant post, the BTC SOPR hints there may be some ways to go still before a bottom forms.

The “spent output profit ratio” (or SOPR in brief) is an indicator that tells us whether investors are selling at a profit or a loss right now.

The metric works by evaluating the history of each coin on the chain to see which price it was last moved at. If this price was less than the current price (that is, the selling price), then the coin sold at a profit.

On the other hand, the last price being more than the current one would imply the investor realized a loss on this coin.

Related Reading | On-Chain Data: Bitcoin Whales Buy The Dip As BTC Drops To $39k

When SOPR has a value more than one, it means the overall market is making a profit at the moment. While ratio values below the threshold imply a realization of losses.

Now, here is a chart that shows the trend in the Bitcoin SOPR over the past few years:

Looks like the indicator’s value is above 1 right now | Source: CryptoQuant

In the above graph, the quant has marked the important points of trend. It seems like bottoms have historically formed whenever the Bitcoin SOPR has dipped below the value = 1 mark.

The significance of this “one” level is that investors are just breaking even at this point. The value drops any further and they are selling at a loss.

Relate Reading | TA: Bitcoin Recovers Losses But Here’s Why $41.5K Could Prevent Gains

After capitulation, there aren’t many sellers left in the market normally, hence why a bottom forms during such periods.

Now, looking at the current trend, it seems like the value of the Bitcoin SOPR is around 1.31 right now. This is still a bit above the 1 level, which could suggest there may be more downside in the store for the crypto before a new bottom formation takes place.

However, it’s also possible the price may see a temporary rebound here, as it already did once earlier in the year around a similar SOPR value.

BTC Price

At the time of writing, Bitcoin’s price floats around $40.7k, up 1% in the last seven days. Over the past month, the crypto has lost 3% in value.

The below chart shows the trend in the price of the coin over the last five days.

BTC’s price looks to have surged up over the past twenty-four hours | Source: BTCUSD on TradingView
Featured image from Unsplash.com, charts from TradingView.com, CryptoQuant.com

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Is The Bitcoin Bottom In? Here’s What SOPR Data Says

Bitcoin has continued its rally breaking above $42k today, making many wonder whether $33k was the bottom. Here’s what the SOPR data says about it.

Bitcoin Short-Term Holder SOPR Starts Turning Green Again

As explained by an analyst in a CryptoQuant post, the current BTC SOPR pattern may look similar to that around the bottom formation back in July of last year.

The “Spent Output Profit Ratio” (or SOPR in short) is an on-chain indicator that tells us whether investors are currently selling at a profit or at a loss.

The metric works by checking the history of each coin being sold on the chain to see what price it was last moved at. If the Bitcoin price before was less than the current one, then the coin is considered to have been sold in profit.

When the SOPR has values greater than 1, it means holders have been selling at a profit on average. On the other hand, values of the indicator below the threshold imply investors sold at a loss overall during this period.

Related Reading | Bitcoin Leverage Ratio Suggests More Decline May Be Coming

Naturally, SOPR values exactly equal to one mean the market broke even on average. Now, here is a chart that shows the trend in this Bitcoin indicator over the last year:

Looks like the LTH SOPR had a large spike recently | Source: CryptoQuant

As you can see above, there are separate graphs for two versions of the Bitcoin SOPR indicator. They are the short-term holder (STH) SOPR and the long-term holder (LTH) SOPR.

Now, looking at the chart, it seems like the STH SOPR has been below one for a while now, but has now started to just turn green again. Also, the LTH SOPR had a huge spike recently.

Related Reading | Bitcoin Begins Bounce From 7-Year Bull Trend Line — Is This The Bottom?

The quant has pointed out that this trend of the two metrics seems to be similar to what happened during the May-July 2021 bear period. The bottom formation took place then, so if there is any pattern here, the bottom may be in now as well.

However, the analyst also notes that the reason behind the large LTH SOPR spike this time looks to be because of the Bitfinex hack, where a large number of dormant coins were moved. On the other hand, the last time it happened was because of a bear trap. Whether this is a false signal this time because of it remains to be seen.

BTC Price

At the time of writing, Bitcoin’s price floats around $42.7k, up 15% in the last seven days.

BTC’s price rallies up | Source: BTCUSD on TradingView
Featured image from Unsplash.com, charts from TradingView.com, CryptoQuant.com

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Bitcoin On-Chain Demands Suggests That The Market Has Reached Its Bottom

Bitcoin on-chain analysis can be a good way to try to guess where the market is headed. The market tends to repeat itself with metrics looking the same before a bull or a bear rally, thus making this data a pretty good indicator of what’s to come. Analyst Willy Woo uses this same data to demonstrate a pattern that occurs before the bull rally, the criteria which are being met once again.

Start Of A Bull Run?

In a recent string of tweets, analyst Willy Woo presents data from on-chain analysis that points to the bitcoin dump having reached its bottom. According to him, “Price in relation to on-chain demand from both speculative and hodl category of investors are now both at peak oversold levels.” Woo points out that the last time that something like this had happened was when bitcoin reached its bottom following the COVID crash.

Price in relation to on-chain demand from both speculative and hodl category of investors are now both at peak oversold levels.

The last time this happened was October 2020. The time before that was at the bottom of the COVID crash.

— Willy Woo (@woonomic) February 2, 2022

The analyst further outlines the times where this has happened in the past. Going as far back as 2012, he points out the same had been the case in February of that year. What followed had been the memorable 2021-2013 bull run that saw bitcoin gain more popularity among investors.

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Fast forward to 2015 and the same had been the case in January of that year. This time, the on-chain metric spelled the bottom of the bear market that had begun previously in 2014, putting an end to the onslaught.

If Woo is right and the on-chain metric continues the way it has historically, then bitcoin may very well have reached the bottom, suggesting that this is the end of the downtrend. However, there is no telling if this is actually the case given that bitcoin had recorded back-to-back bull rallies in 2021.

Bitcoin On The Charts

Bitcoin has lost almost 50% from its all-time high of $69k which it hit in November of last year. This has however not affected the profits of the majority of holders. The digital asset remains one with the highest volume of holders that remain in profit after the market crash.

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According to data from IntoTheBlock, 60% of all bitcoin holders are still in profit at current prices. It is important to note that the cryptocurrency was subject to massive sell-offs when investors panicked that the downtrend will continue. Most however have still kept their highly profitable status, with only 35% of all holders currently losing at market prices.

Bulls struggle to pull BTC up as bears take hold | Source: BTCUSD on TradingView.com

The majority are long-term holders and indicators point to investors still being very bullish on the digital asset despite the downtrend. With its current growth curve, it is expected that the cryptocurrency will see 1 billion holders in the next four years, making it a highly sought-after asset.

Featured image from Bitcoin News, chart from TradingView.com

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What A Decline Under $35,511 Would Mean For The Price Of bitcoin

Bitcoin has lost its footing at $37,000 and has now slipped into the $36,000 territory, sending the market into another frenzy of fear. It comes on the back of widespread speculations that the digital asset had indeed hit its bottom. But with the current trend, the digital asset may end up sliding down further. To this end, Fundstrat analyst Mark Newton has laid out the possibilities for bitcoin if it declines further than $35,511.

What Happens Below $35,511

Technical analyst Mark Newton has put forward a bullish outlook for bitcoin if it falls below this point. He told Bloomberg that a decline under this would inevitability lead to a test of $32,950. Also adding that the price of the digital asset moving above $40,000 would be an important point for the bulls.

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However, the market has seen massive sell-offs close to this price point in recent times that Newton’s predicted point for the bulls is yet to be hit. With the digital asset suffering so many price dips in such a short period of time, bitcoin looks more likely to fall below $35,511 than it is to give bulls a much-needed pull above the $40,000 point. The Fundstrat analyst explained that without reaching this point, the asset would remain on a downward trend.

“Until $40,000 is exceeded on a daily close, it remains in a downward sloping pattern, and it’s tough to rule out further weakness technically speaking,” the analyst said.

This reflects the cautious way of thinking that Newton is using to look at the market. At a point like this, there is no way to tell for sure what the market will do, so being wary is the best cause of action.

Bitcoin Bottom Is Not In

The technical analyst also touched on the bitcoin bottom, sharing thoughts that deviated from current trends. Newton said that the bitcoin bottom is not in yet. Instead, the analyst believes that the bottom will come in over the next few months.

Related Reading | Bitcoin Halving To Bring The Subsequent Crypto Frenzy

As for the recovery recorded following the market crash, he explained that it is only temporary. Furthermore, does not believe that it is an indicator that there will be an intermediate-term rally. “This minor two-week bounce might still be premature in expecting a new intermediate-term rally has begun,” Newton added.

BTC trending at $36K | Source: BTCUSD on TradingView.com

Bitcoin’s price still remains firmly in the $36,000 territory, suggesting that the short-term rally might be over. Bearish sentiment is the order of the day with market sentiment falling deep into extreme fear.

Bitcoin is trading at $36,800 at the time of this writing.

Featured image from CCN.com, chart from TradingView.com

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Galaxy Digital CEO Mike Novogratz Says Bitcoin Has Hit The Bottom

Bitcoin has been on a downward streak since the last quarter of 2021, and this has spilled into the new year. As January goes into full bloom, it has come with discouraging movements for investors as over $500 billion has been wiped off the market. This has sent bitcoin’s price down to the dreaded $40,000 price range.

One question that remains in the mind of investors is, has the market seen the bitcoin bottom? Billionaire Mike Novogratz attempts to answer this as he puts forwards his thoughts on the issue and predicts the bitcoin bottom.

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Bitcoin Should Bottom Out Between $38,000 to $40,000

Galaxy Digital CEO Mike Novogratz has always been an active voice in the crypto space and has at various times given his thoughts on the market. This time around, Novogratz sat down with CNBC’s Squawk Box, where he predicted where the bottom of the current bitcoin downtrend will be.

The billionaire CEO placed the floor of the current downtrend at $38,000 which he does not see bitcoin going under. Currently, bitcoin’s lowest during the dips have been $40,680, from which the digital asset has since recovered. But if Novogratz’s predictions are anything to go by, then the market may see another dip before there is a full-blown recovery trend.

BTC price tumbles down to $41,475 | Source: BTCUSD on TradingView.com

The CEO gives his reason for this bottom as institutional investors taking advantage of the low prices to get into the digital asset. I” know big institutions who are going through their process to put positions on. They’re going to see those as attractive levels to buy,”  Novogratz said.

“On the charts, $38,000, $40,000 feels like where we should bottom,” he added.

Inflation Will Drive Growth

Continuing on, Novogratz shares more regarding his stance on this predicted bitcoin bottom. One of those has been inflation.

Those who have been following the markets know that rising inflation rates have led to increasing concerns among investors who have begun to look for alternatives to gold to serve as an inflation hedge. Bitcoin has naturally become the option for these investors.

The Fed believes that inflation rates will begin to come down, but the CEO explained that if this does not go as planned, then “all bets are off.”

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Digital Galaxy, on which Novogratz heads as CEO, has made a name for itself in the space as being a big bitcoin proponent. The company currently holds over 12,000 bitcoins, making it one of the companies with the largest bitcoin holdings in the world.

Mike Novogratz himself also has a personal stake in cryptocurrencies, revealing that he holds about 85% of his net worth in cryptocurrencies, which at the time translated to up to $4.8 billion held by the billionaire in crypto.

Featured image from Stock Hax, chart from TradingView.com