On-Chain Data Shows Bitcoin Has 74% Room to Grow Before Entering Overbought Territory
The recent Bitcoin price action has sparked mixed reactions among investors, but on-chain metrics suggest the market still has room to grow.Bitcoin hit an all-time high of $109,110 this week but has since dropped to $101,257. While it has rebounded, the repeated cycle of fluctuations and recoveries continues to create uncertainty among market participants about the current bull season. Some have even suggested that the market top may be in.However, Bitcoins on-chain data indicates that theres still potential for growth before it enters overbought territory. Specifically, the Mayer Multiple (MM), a key indicator for assessing Bitcoin's price relative to its 200-day moving average (200DMA), presents important insights into the current bull market trajectory.Understanding the Bitcoin Mayer MultipleThe Mayer Multiple is calculated by dividing Bitcoins price by its 200DMA and has historically been used to identify key moments in Bitcoins market cycles. MM values above 2.4 signal overbought conditions, while values below 0.8 indicate oversold levels.According to the analytics platform Glassnode, these metrics have proven reliable indicators of price extremes, helping investors navigate macro trends. Currently, Glassnodes data shows Bitcoins Mayer Multiple at 1.37. This means that while its price is 37% above its 200DMA, it is still well below the overbought threshold.Notably, Bitcoin will enter the overbought zone when its price exceeds $181Knearly 74% higher than its current price of $104K.
Text source: The Crypto Basic
