Glassnode Points Out This Bizarre Consistency In Bitcoin Cycles

Glassnode has pointed out a bizarre consistency between the current and previous Bitcoin cycles in terms of a metric, here’s what. Bitcoin Breaks Above 200-Day Simple Moving Average Line A “simple moving average” (SMA) is an analytical tool that produces an average of any given quantity over a specific period of time. As its name already implies, it moves along with the quantity and changes its value accordingly. SMAs can be quite useful for studying long-term trends, as they smooth out the curve and filter out any short-term fluctuations in the relevant quantity that have no bearing on the longer trends anyways. As is usually the case with tools like these, an SMA can be taken for any length of time, but a few periods like 7 days and 30 days generally find the most use. According to data from the on-chain analytics firm Glassnode, BTC has spent 381 days under its 200-day SMA curve in this cycle. The 200-day SMA is an important line for BTC as both the bear-to-bull and vice versa transitions have historically taken place with breaks above or below this level. Related Reading: Bitcoin Miners Show Signs Of Dumping, Bad For Rally? Here is a chart that shows the trend in the 200-day SMA for Bitcoin over the last few years: The value of the crypto seems to have broken above the 200-day SMA in recent days | Source: Glassnode on Twitter As displayed in the above graph, the Bitcoin price had dipped below the 200-day SMA around the start of the bear market and had stayed there until very recently. In total, the crypto had spent 381 days below this level, before the latest rally came along and helped the coin finally escape above this line. In the chart, Glassnode has also highlighted the trend for the metric during the previous bear market. It looks like in that cycle as well, the crypto’s price had declined below the 200-day SMA as the bear began to take hold. Also, the eventual break above the level leads to the end of the bear market for the coin back then. Related Reading: Bitcoin Price Resumes Increase as The Crypto Bulls Take Control However, the most interesting of all is the duration that Bitcoin stayed below this level in that cycle: 386 days. Amazingly, this is very nearly the same number of days (381) that BTC took to break above the line in the current cycle. If this bizarre consistency is anything to go by, then the latest push above the 200-day SMA could mean the current bear market might be done as well. The chart also shows data for an indicator called the “Mayer Multiple” (MM) which gauges the current distance between the price of Bitcoin and the 200-day SMA. Its value is simply calculated by dividing the value of the crypto by the 200-day SMA. Bottoms in the crypto have usually taken place below the 0.8 MM level, which BTC is now firmly above. BTC Price At the time of writing, Bitcoin is trading around $20,800, up 21% in the last week. BTC consolidates just below $21,000 | Source: BTCUSD On TradingView Featured image from André François McKenzie on Unsplash.com, charts from TradingView.com, Glassnode.com

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This Bitcoin Rally Is Similar To Genesis Points Of Historical Uptrends: Glassnode

Data from Glassnode reveals that the structure of the current Bitcoin rally is looking similar to the genesis points of historical uptrends. Bitcoin Recovery Since November Lows Is Reminiscent Of Past Rallies In its latest weekly report, the on-chain analytics firm Glassnode has looked into how the current Bitcoin rally lines up against similar rallies that the cryptocurrency observed during the previous cycles. To make this comparison, the analytics firm has taken the data for the performance of the coin starting from the all-time high in each cycle. Here is a chart that shows how the past bear market rallies have looked like in terms of this metric: The bear market rally performance throughout the different cycles | Source: Glassnode's The Week Onchain - Week 28, 2023 Note that only the upwards performance of Bitcoin is being considered here, and the drawdown has been excluded. From the chart, it’s visible that during all the cycles, gains after the ATH was set disappeared in time as the bear market went into full gear. Soon after the bear bottom formation took place, these cycles saw the asset experiencing a recovery rally. In the current cycle so far, it’s not completely certain yet if the November 2022 low seen after the FTX crash was indeed the cyclical bottom. However, if it’s assumed that this low was indeed the bottom, then the rally that has been going on in the past few months would take the role of the recovery rally in the current cycle. Related Reading: Bitcoin NVT Golden Cross Says BTC Is Overpriced, Decline Soon? Interestingly, so far, the cryptocurrency has seen an uplift of 91% since the aforementioned bottom, which is very similar in scale to the recovery rallies of the past cycles. “With the exception of 2019, all prior cycles which experienced a similar magnitude move off the bottom, were in fact the genesis point of a new cyclical uptrend,” explains Glassnode. The reason 2019 was different is that the April 2019 rally (which may have normally acted as the recovery rally from the bear market bottom) ran out of steam before long and the price subsequently declined. The drawdown was then extended in March 2020 as the crash due to the emergence of COVID-19 took place. It’s the recovery rally from this crash that ended up leading to the 2021 bull market. Naturally, if the pattern of the first two Bitcoin cycles is anything to go by, the current recovery rally structure may mean that the asset is now on its way toward a cyclical uptrend. Related Reading: XRP FUD Spikes, Will This Trigger A Price Reversal? The analytics firm has also looked at the rally from another angle: this time in terms of the drawdown (that is, the negative performance). The drawdowns across the bull markets | Source: Glassnode's The Week Onchain - Week 28, 2023 As displayed in the graph, the Bitcoin rally has seen a peak drawdown of just 18% so far, which is clearly much less than what the previous bull markets saw. “This perhaps suggests a relatively strong degree of demand underlies the asset,” suggests Glassnode. BTC Price At the time of writing, Bitcoin is trading around $30,400, down 2% in the last week. BTC has continued its sideways movement recently | Source: BTCUSD on TradingView Featured image from iStock.com, charts from TradingView.com, Glassnode.com

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Bitcoin Shows Parallels With 2017 Cycle, Here’s What Can Happen Next

A quant has pointed out parallels between the current and the 2017 Bitcoin cycles, something that may contain hints about what’s next for the asset. The Current Bitcoin Cycle Has Shown Interesting Parallels With The 2017 Cycle As explained by an analyst in a CryptoQuant post, there have been five interesting recent events in the [...]

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Bitcoin Rally May Not Have Hit Top Yet, Here’s Why

The historical pattern in this Bitcoin on-chain indicator may suggest that the ongoing rally hasn’t reached its top yet. Bitcoin 1-Year Inactive Supply Has Continued To Go Up Recently According to a post from the on-chain analytics firm CryptoQuant, the 1-year inactive supply hit a high back in March of this year. The “1-year inactive [...]

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