Would You like a feature Interview?
All Interviews are 100% FREE of Charge
The 30-day exponential moving average of the number of “profitable” Bitcoins (i.e. taken when the BTC price fell) hit a two-month high on the 19th.th According to crypto data and on-chain analytics firm Glassnode:
The 30-day EMA of bitcoin supply in Glassnode’s profit has risen to over 10.5 million coins, following the latest Bitcoin rally that saw the world’s largest cryptocurrency by market capitalization regain $21,000. This is the highest level since September last year. There are currently 19.27 million Bitcoins in circulation, of which 21 million can be mined.
As a result, the profit trend supply is now positive, says Glassnode. “During positive market trends, BTC supply acquired at low prices tends to increase, with more supply resulting in unrealized profits,” explains the crypto analytics firm.
“Therefore, macro-trend changes in profit supply may indicate that investors’ cost-based concentration has recently shifted between unrealized gains or losses,” adds Glassnode. “Often these occur near changes in the macro market cycle”.
Profit supply hits highest since May 2022
The indicator above uses the EMA for less volatile results and may serve as a better signal of a market change in direction. But more basic indicators of profit supply also seem to be sending bullish signals.
According to Glassnode, 66.9% of Bitcoin was profitable on Thursday the 19th.th increased from about 50% at the turn of the year. This means that about 12.9 million bitcoins have moved in the last time the price fell.
Looking at the long-term history of Glassnode’s more basic Supply in Profit metric, recovery from below 50% often precedes the onset of a bull market.
Other signals also flash green
Multiple other technical and on-chain indicators are starting to flash green indicating that the 2022 bear market may be over. For example, Bitcoin’s latest push to recover above $21,000 from levels around $17,000 at the end of 2022 saw the world’s largest cryptocurrency by market capitalization return north of his 200-day moving average and realized price. indicates that Fits just under $20,000.
Momentum for new addresses has also picked up recently, with the 30-day Simple Moving Average (SMA) recently breaking above the 200-day SMA, a shift often seen at the start of a Bitcoin bull market.
Meanwhile, according to analysis by the pseudonymous Twitter account @CryptoHornHairs, Bitcoin appears to be almost exactly aligned with long-term market cycles that repeat approximately every four years. @CryptoHornHairs says Bitcoin is at the beginning of a bullish stage of the cycle after his 364-day slump.
But Bulls Beware, No Revenue Momentum From Fees
Glassnode’s Revenue From Fees Multiple two-year Z-score is still negative around -0.41. A Z-score is the number of standard deviations above or below the mean of a data sample. In this example, Glassnode’s Z-score is the number of standard deviations above or below the average Bitcoin fee revenue over the last two years.
“The sustained rise in fee income as a percentage of total rewards indicates that Bitcoin blocks are filling and trading activity is in high demand,” said the crypto analytics firm. Given the coin’s restricted block size, this has historically provided a valuable early indicator of macro-trend shifts in the network demand profile. It should be a red flag for the bulls as it implies weak activity.
So where’s next for BTC?
As such, we still don’t have all the signals that Bitcoin’s rapid rally is continuing. But bulls should not be afraid. 2023 will (probably) not be like 2022. U.S. inflation and growth are easing rapidly, and the U.S. Federal Reserve’s rate hike cycle may already be largely over. Markets and many analysts expect only a few more rate hikes despite still hawkish talk from the world’s most important central banks and an easing bias towards 2024.
Many crypto analysts hope the deleveraging cycle is nearing maturity after witnessing the collapse of many industry giants such as Three Arrows Capital, Celsius, FTX and most recently Genesis. increase. Analysts also hope for positive regulatory developments in major markets such as the US this year, including the resolution of the SEC v. Ripple lawsuit and further progress towards broader crypto regulation legislation.
It’s probably unreasonable to expect the uptrend to continue this month, but it’s quite possible (barring further shocks to the economy/industry) that it will continue. In the short term, a breakout of $21,500 could lead to a rally towards the critical $25,500 balance area.