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Has Bitcoin Price Hit Bottom? 4 Crucial On-Chain Signals

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In the crypto ecosystem, pinpointing the exact moment Bitcoin (BTC) prices bottom out is akin to finding a needle in a haystack. Recent data, however, provides some insights into whether the Bitcoin price has bottomed.

As the digital currency touched a one-month low of $58,500, analysts from CryptoQuant and Glassnode revealed four crucial on-chain indicators to watch. These indicators could be useful for analyzing market behaviors near the low points and understanding the conditions necessary for prices to rebound and rise again.

1. Tracking Bitcoin Demand Growth

The first quarter of 2024 saw a remarkable surge in Bitcoin demand coinciding with the launch of US spot ETFs, establishing record highs. However, post-May, this demand has seen a significant slowdown.

It is vital to observe the demand from permanent holders to determine whether Bitcoin has bottomed out. Permanent holders are now buying at a rate of 72,000 Bitcoin per month.

However, demand is significantly lower than in early 2024. A resurgence to these levels is essential for a sustainable price rally.

Read more: Bitcoin (BTC) Price Prediction 2024/2025/2030

Bitcoin Demand From Permanent Holders
Bitcoin Demand From Permanent Holders. Source: CryptoQuant

Apart from the demand side, Glassnode’s analysis reveals significant insights into the behavior of long-term holders (LTHs), who play a crucial role in the supply side as well. LTHs typically distribute coins and take profits during bull markets, helping to establish market cycle tops.

Currently, the market is witnessing a regime where LTH divestment is moderated. This indicates a move toward equilibrium rather than euphoria, which is a phase when the unrealized profits of LTHs are more than 250%. The high profits motivate LTHs to sell BTC aggressively, marking a market top.

The current equilibrium phase suggests that while LTHs are not yet ready to offload their holdings massively, they are also not accumulating at a pace, thus providing a balanced supply dynamic in the market.

2. Assessing the Profitability of Traders

Another indicator is the profitability of traders. Currently, on-chain unrealized margins for traders are in the negative, suggesting reduced selling pressure but not necessarily a readiness for a price rebound.

For a bullish signal, these margins need to turn positive and rise above their 30-day simple moving average.

“Since mid-June, the spot price has plunged below the cost basis of both the 1-week to 1-month-old holders ($68,500) and 1-month to 3-month-old holders ($66,400). If this structure persists, it has historically resulted in a deterioration of investor confidence and risks this correction being deeper and taking longer to recover from,” Glassnode said.

Read more: 8 Best On-Chain Analysis Tools in 2024

Bitcoin On-Chain Trader Realized Price and Profit/Loss Margin
Bitcoin On-Chain Trader Realized Price and Profit/Loss Margin. Source: CryptoQuant

3. Evaluating Stablecoin Liquidity

The growth in Tether’s USDT market capitalization is a proxy for liquidity in the cryptocurrency market. After peaking at $12.6 billion in late April, the growth over the past 60 days has slowed dramatically to just $2.5 billion, marking the slowest pace since November 2023.

An acceleration in stablecoin liquidity is essential for Bitcoin prices to rally. This will provide the market with the needed capital inflow to support higher price levels.

USDT Market Cap Change and Bitcoin Price
USDT Market Cap Change and Bitcoin Price. Source: CryptoQuant

4. Monitoring the Ultimate Bitcoin Price Support Level

The final indicator to watch is Bitcoin’s support level, currently pegged at $56,000 based on Metcalfe’s price valuation bands.

“This valuation is based on the Metcalfe law that states the value of a network is proportional to the number of users in the network,” CryptoQuant explains.

This level has historically acted as both resistance and support in previous cycles. It also provided support to Bitcoin when its price dropped to around $56,500 in May 2024. A drop below this critical support could signal a significant market correction while maintaining above this level could suggest the market has bottomed.

Read more: How To Evaluate Cryptocurrencies with On-chain & Fundamental Analysis

Bitcoin Metcalfe Price Valuation Bands
Bitcoin Metcalfe Price Valuation Bands. Source: CryptoQuant

Amid these technical indicators, social sentiment also shows signs that the market may believe the bottom has been reached. Analysis from Santiment highlighted a spike in social volume and dominance for the term “bottom,” suggesting a growing belief among investors and traders that Bitcoin’s price may not fall further.

However, the market often tends to go against the retail sentiments. Hence, traders and investors should consider the nuances carefully and do their own research before building new market positions.

Disclaimer

In line with the Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to accurate, unbiased reporting, but market conditions are subject to change without notice. Always conduct your own research and consult with a professional before making any financial decisions. Please note that our Terms and ConditionsPrivacy Policy, and Disclaimers have been updated.



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Why FET Recovery Could Be More Than 10% in November

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Artificial Superintelligence Alliance (FET) is one of the top gainers today, registering a 10% increase within the last 24 hours. This FET recovery contradicts its performance in October, when its price decreased by 13.39%.

Following this rebound, on-chain data shows that the altcoin could be working toward wiping out those losses. Here is how.

Artificial Superintelligence Alliance Sees Buying Pressure  

Yesterday, FET’s price was $1.10. But as of this writing, the altcoin’s value has risen to $1.25. According to the 4-hour chart, FET’s price climbed this high due to rising buying pressure. 

Notably, Bull Bear Power (BBP) has jumped to the positive region after remaining in the red area since November 1. The BBP shows whether the strength of buyers is greater than that of sellers.

When the reading is negative, bears have the upper hand. Therefore, in this instance, bulls are in control. As such, the altcoin’s value could continue to climb if this remains the same. 

Read more: How to Invest in Artificial Intelligence (AI) Cryptocurrencies?

FET recovery driven by bulls
FET Bull Bear Power. Source: TradingView

The Money Flow Index (MFI) is another indicator suggesting that the FET recovery could be swift. The MFI, which measures buying and selling pressure by analyzing price and volume data, has shown a positive trend for FET. 

A rising MFI indicates increased buying pressure, which supports the likelihood of continued price growth as demand for the asset strengthens. Therefore, if bulls sustain this momentum, then the altcoin’s price might continue to rise.

FET recovery is ongoing
FET Money Flow Index. Source: TradingView

FET Price Prediction: Token to Breach Resistance

Since the IOMAP indicates that there is only one significant resistance level for FET at $1.28, where 3,590 addresses hold 616.89 million tokens, it suggests that surpassing this level could open up further upside potential. 

Notably, the IOMAP tool categorizes addresses by whether they are making a profit, breaking even, or incurring losses at the current price

This accumulation zone acts as a key psychological barrier. The volume of tokens accumulated here is notably higher than the amounts held between $1.06 and $1.25, signaling that if buyers manage to push the price beyond $1.28, FET could gain strong momentum.

Read more: Which Are the Best Altcoins To Invest in November 2024?

FET bulls to breach resistance
FET In/Out of Money Around Price. Source: IntoTheBlock

Therefore, if buying pressure continues to increase, FET could rally all the way to $1.44. However, if bulls fail to breach the resistance, the altcoin price might pull back, and FET could drop to $1.10.

Disclaimer

In line with the Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to accurate, unbiased reporting, but market conditions are subject to change without notice. Always conduct your own research and consult with a professional before making any financial decisions. Please note that our Terms and ConditionsPrivacy Policy, and Disclaimers have been updated.



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US Election Day Boosts Bitcoin to $70,000: Further Rally Ahead?

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Bitcoin’s (BTC) price climbed to $70,000 today ahead of the US presidential election, indicating the connection between major political events and cryptocurrency movements. Historically, political uncertainty and significant elections have influenced crypto market sentiment and volatility.

As the election begins, on-chain analysis provides insights into potential future price movements. Analysts are also weighing in on the implications of the election outcome for Bitcoin, with opinions varying on whether the cryptocurrency could continue its upward trend or face downward pressure. Here are all the details.

According to Glassnode, the Bitcoin price increase comes amid a drop in the sell-side risk ratio. This metric shows whether investors are confident about a bullish performance or if conviction is low.

High values in this metric indicate periods when significant amounts of value are being realized, often correlating with increased market volatility. Such periods are commonly seen during the late stages of bull markets.

Conversely, low values suggest periods with minimal value realization and reduced market volatility. This can also signal macro market bottoms, accumulation phases, and environments with lower sell-side pressure and risk, potentially indicating the onset of future bullish trends.

Read More: 7 Best Crypto Exchanges in the USA for Bitcoin (BTC) Trading

Bitcoin selling pressure reduces
Bitcoin Sell-Side Risk Ratio. Source: Glassnode

Therefore, the rise in Bitcoin’s price indicates that selling pressure is low, and the US elections could be bullish for the cryptocurrency.

Regarding this development, Juan Pellicer, Senior Researcher at IntoTheBlock, opined that a Donald Trump win would be good for BTC and the crypto market at large.

“The market appears primed for further upward movement, with the US election serving as a potential catalyst. Sentiment suggests that Trump’s more favorable stance on cryptocurrencies could provide the momentum needed for a decisive breakthrough to a new all-time high.” Pellicer told BeInCrypto

Meanwhile, CryptoQuant’s weekly report says that BTC is at a favorable price level ahead of the elections. It noted that the cryptocurrency is currently not overvalued. Hence, if demand increases, Bitcoin’s price might rally post-election.

For instance, BTC prices rallied by 22% between election day and December 2012. In 2016, it climbed by 37%, while the cryptocurrency saw a 98% increase in 2020. 

Therefore, if past performance influences future trends, the BTC might reach a new all-time high before the end of the year.

Data from the on-chain data provider also showed that demand for Bitcoin has increased. This is similar to the trends of 2016 and 2020. Hence, if sustained, the Bitcoin price might climb well above $70,000 soon.

Bitcoin demand rises
Bitcoin Apparent Demand. Source: CryptoQuant

BTC Price Prediction: $73,000 Possible

On the 1-hour chart, Bitcoin has attempted to break out on four different occasions. However, each time that happened since October 31, the coin faced rejection. However, today, the trend has changed as bulls pushed the cryptocurrency above $68,336.

This breakout has ensured that Bitcoin’s price has risen to $70,288. Furthermore, the Bull Bear Power (BBP) shows that bulls are in control. If sustained, Bitcoin’s price might rally much higher in the coming days.

Read More: Bitcoin (BTC) Price Prediction 2024/2025/2030

Bitcoin US election day price analysis
Bitcoin 1-Hour Analysis. Source: TradingView

If bullish momentum persists, Bitcoin could potentially climb to $73,623 ahead of the announcement of the US election results. However, should BTC face rejection at resistance levels, this forecast might be invalidated, with the cryptocurrency possibly declining to $67,405.

The post US Election Day Boosts Bitcoin to $70,000: Further Rally Ahead? appeared first on BeInCrypto.



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Why Ethereum’s Weak Momentum May Block $2,600 Breakout

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Ethereum (ETH) price is showing signs of weakening strength as polls open across most of the US.

Despite a 24% surge in trading volume over the past 24 hours and a modest 1% price uptick, technical indicators suggest a potential downturn. Here’s a closer look at the factors behind this analysis.

Ethereum to Remain “Under”

Readings from the altcoin’s Super Trend indicator reflect Ethereum’s weak price action. At press time, its red line rests above Ethereum’s price, confirming the potential downward trend.

This indicator helps traders identify the prevailing market trend and potential entry or exit points. It detects changes in price direction and determines support and resistance levels, often signaling when to buy or sell an asset. When the Super Trend line moves above the price and turns red, it signals a bearish trend, often considered a sell signal.

On the ETH/USD one-day chart, Ethereum’s Super Trend line is above the coin’s price at $2740, forming a resistance level that may be difficult to breach if new demand fails to enter the market. When the Super Trend line moves above the price, it acts as a resistance level. This is because the line indicates a potential “ceiling” where the price might face resistance if it attempts to rise. 

Read more: Ethereum ETF Explained: What It Is and How It Works

Ethereum Super Trend.
Ethereum Super Trend. Source: TradingView

Moreover, the setup of ETH’s moving average convergence/divergence (MACD) indicator — which tracks its trend direction, shifts, and potential price reversal points — supports this bearish outlook. As of this writing, ETH’s MACD line (blue) rests below its signal line (orange) and zero line. 

This bearish signal suggests that ETH’s short-term momentum is weakening. Traders often interpret this as a signal to exit long positions and take short ones.

Ethereum MACD.
Ethereum MACD. Source: TradingView

ETH Price Prediction: August 5 Low Is Possible

If buying pressure weakens, Ethereum’s price could fall toward its August 5 low of $2,112, marking a 13% drop from its current value. Conversely, a surge in demand could propel the coin to test resistance at $2,508.

Read more: Ethereum (ETH) Price Prediction 2024/2025/2030

Ethereum Price Analysis
Ethereum Price Analysis. Source: TradingView

A successful breakthrough at this level would set the next target at the Super Trend line resistance of $2,740. Clearing this mark with strong momentum could position Ethereum for a climb toward $2,869 — a level not seen since August.

Disclaimer

In line with the Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to accurate, unbiased reporting, but market conditions are subject to change without notice. Always conduct your own research and consult with a professional before making any financial decisions. Please note that our Terms and ConditionsPrivacy Policy, and Disclaimers have been updated.



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