As a researcher with several years of experience in analyzing cryptocurrency markets, I’ve seen my fair share of price movements and market conditions. Based on the current situation with BTC prices hovering around $70,000 after a recent retreat, I believe we may be witnessing a repeat of late-2020 market dynamics.
During the Asian trading session on Wednesday morning, Bitcoin‘s price has dropped back under $70,000. However, the market doesn’t show signs of being overbought as per the assessment of analyst James Check.
“Currently, Bitcoin prices align well with the fundamental indicators based on my analysis of multiple volume measurements,” the analyst noted in his May 21 newsletter.
Moreover, the market looks like it did in late-2020, he added.
As a researcher studying the Bitcoin market, I’ve observed an intriguing development towards the end of 2020. Around early December, prices of Bitcoin remarkably regained its previous all-time high from 2017, reaching $20,000. For about two weeks afterward, the price stabilized around this level before making another significant leap – surging to a new record peak of $30,000 by New Year’s Day.
The #Bitcoin NVT Price models are a sort of fair value model, imputing a price based on transaction throughput.
As a crypto investor, I’m closely monitoring bitcoin’s (BTC) price action based on several volume indicators. At present, these metrics suggest that BTC’s price aligns well with its underlying fundamentals.
Looks like late-2020
— _Checkmate (@_Checkmatey_) May 21, 2024
History Rhyming?
As a crypto investor, I’ve observed that Bitcoin prices have been on an uptrend during this current market cycle, reaching close to retaking the mid-March peak of $73,738. However, at this level, BTC seems to be encountering resistance, suggesting a positive trend and potentially paving the way for further price discovery.
“An analyst remarked that only seven days in the historical market data have shown a closing price higher than $71,000, making our current position rather rarefied and exclusive.”
I noted that reaching a compelling new record high often requires more than just one attempt. Instead, a phase of persistent effort and several significant attempts is typically the norm.
Additionally, the Network Value to Transaction (NVT) ratio indicates that Bitcoin’s price aligns with its network transaction activity, mirroring the patterns observed towards the end of 2020.
As a crypto investor, I’ve been keeping a close eye on the markets and one metric that caught my attention is the Short-Term Holder Spent Output Profit Ratio (SOPR). This ratio indicates whether short-term holders are making a profit or incurring a loss when they spend their coins. An SOPR above 1 means that, on average, short-term holders are selling at a profit, while a ratio below 1 implies a loss.
In this situation, a large group of people find themselves unexpectedly purchasing a large quantity of coins at an inflated price.
Glassnode’s analysis reveals a “top-heavy” market situation in which a large proportion of investors are currently bearing losses on their investments. However, this trend has noticeably improved as only 6.6% of the short-term holder inventory now represents lost assets. Consequently, the likelihood of widespread selling due to panic is diminished.
More Chopsolidation Ahead
As a crypto investor, I closely follow the analysis of respected figures in the community, like “Rekt Capital.” On May 21, he suggested that if Bitcoin (BTC) managed to close the weekly candle above $71,500, it could initiate a breakout from the current re-accumulation range. Unfortunately, at the time of writing, BTC prices had slipped down to $69,782.
Based on historical trends, Bitcoin may need to spend a few more weeks trading within this consolidation range before showing signs of significant price movement.
#BTC
As a crypto investor, I believe that if the weekly candle closes above the $71,500 mark, it could potentially trigger a breakout from the current re-accumulation range.
Based on historical trends, I believe Bitcoin may need to spend a few more weeks hovering within its current Re-Accumulation Range before continuing its price movement.
Extended consolidation here would get Bitcoin closer to…
— Rekt Capital (@rektcapital) May 21, 2024
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2024-05-22 19:37