Feb 04, 2022 07:20
The past few weeks have seen double-digit losses on the crypto market. This was mainly due to short-term speculators, who sold their positions in Bitcoin due to the threat of interest rate increases by the American central bank. But the days of bears seem to be over. The following 3 on-chain indicators suggest that Bitcoin could soon transition back into a bull market.
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#3 Bitcoin is Heavily OVERSOLD
We already mentioned several times in the past few days that Bitcoin has been heavily "oversold" in recent weeks. One indicator of this is the Relative Strength Index (RSI), which recently fell to its lowest level since March 2020. This indicates that bitcoin has been heavily sold relative to its fundamentals.
Another indicator of this is the so-called "entity-adjusted dormancy flow". It indicates the relationship between market capitalization and the behavior of spending on the blockchain. According to this reading, the bitcoin is as "oversold" as only 3 times before and could soon turn into a bull market again.
https://twitter.com/WClementeIII/status/1488201437440094213
#2 Big Whales currently Buy Bitcoin
In order to be able to predict the course in the next few weeks, it is also worth taking a look at the buying behavior of the Bitcoin whales as a point of reference. In 2021, these have gained extreme influence on the Bitcoin course. Increasing buying behavior by whales could predict a Bitcoin bull market.
Now is an ideal point to get in cheaply. Buy bitcoin on crypto exchanges Binance , Coinbase , Kraken and Bitfinex !
Since mid-January, we have seen a clear decoupling of the behavior of the whales over the course of the Bitcoin price. The whales seem to be investing more in Bitcoin again and probably see a bull market on the horizon. As a retail investor, you should take a close look at the behavior of whales.
https://twitter.com/WClementeIII/status/1487080803448373250
#1 Bitcoin Hodlers are still BUYING!
Since November, we have seen multiple price crashes and an overall bearish trend in Bitcoin price. According to the data, these sales were very strongly driven by so-called "marginal macro sellers". In the financial world, these tend to be short-term traders who primarily react to external “macro events”. The new virus variant and looming interest rate hike were such events that led to massive selling.
https://twitter.com/DylanLeClair_/status/1487117211298942979
However, long-term investors have continued to hold their bitcoins and are now slowly adding to them, according to on-chain. Since December, hodlers have been using the low prices to accumulate Bitcoin cheaply. This should also be a clear sign of an upcoming Bitcoin bull market.
Bitcoin 40K - BTC Price up soon?
With the above-mentioned information, we can clearly see why we might see Bitcoin up in the next few days. After an extended bear market, we currently witnessed many green days. It is true that BTC prices did not fully recover yet, but the road to the all-time high of 69K is not over. The current price is lingering around an important area of $38,000. The current consolidation around that price is a strong indicator that the coming move will be strong.
This is especially apparent in figure 1, as we can see the second green weekly candle recovering from the low of the previous crash.
Fig.1 BTC/USD 1-week chart showing the reversal of BTC -
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You can purchase bitcoin on crypto exchanges Binance , Coinbase , Kraken , and Bitfinex .
Bitcoin up
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