Why Bitcoin’s bull run is not over yet, according to key signals

As an experienced analyst, I believe that despite the recent bearish trend, there are strong indications from on-chain metrics suggesting that Bitcoin’s bull run is far from over. The Puell Multiple and the MVRV Long/Short Difference are two such metrics that provide valuable insights into BTC‘s valuation.

Except for the past week, Bitcoin (BTC) has struggled to avoid posting a red candlestick in the last seven days since April. This trend has led some analysts to speculate that the bull market may have come to an end.

Yet, that perspective might not hold water based on the data we’ve gathered from various on-chain indicators. Let’s begin with Bitcoin’s Puell Multiple.

The Puell Multiple, calculated using a 365-day moving average of miners’ revenue, offers valuable insights into Bitcoin’s valuation. By analyzing this metric, we can determine if Bitcoin is approaching a cycle top or if there is potential for further price growth.

It’s bulls over bears again

Historically, the Bitcoin price has peaked during a bull market when the price-to-multiples ratio reaches 3 or more. For instance, this ratio reached a value of 8.13 prior to the bitcoin price beginning to decline.

Back in 2017, as a crypto investor, I would have noticed that the Puell Multiple reached an unusually high level of 6.12. Looking back now, it seems that this was a sign that the bull market had peaked and was about to end.

Based on the latest data from Glassnode at the moment of writing, the metric stands at 0.90. This figure suggests that Bitcoin’s price may have room to rise further.

One observation made by AMBCrypto was that the number of readers decreased each time a new cycle reached its peak.

In other words, there’s a possibility that Bitcoin’s price may not exceed $3k again before it experiences a significant downturn. However, this doesn’t necessarily mean that forecasts predicting prices at $80,000 or higher won’t materialize in the future.

$85,000 is almost a sure bet

“Another indicator that reinforces this bias is the difference between the Market Value to Realized Value Ratio (MVRV) for long and short positions.”

One way to explain the concept of MVRV Long/Short Difference in clear and conversational terms is as follows: The MVRV Long/Short Difference aims to determine the profit or loss each Bitcoin investor realized when they bought the coin, relative to its current market value.

As an analyst, I would interpret a metric reading of 0% for Bitcoin as signaling the conclusion of a bear market. Conversely, when this metric approaches or exceeds 100%, Bitcoin is likely nearing the end of a bull market.

Based on the graph, Bitcoin’s bear market concluded approximately on March 2, 2023. This marked the beginning of its current bullish trend.

As a researcher examining the data on the MVRV Long/Short Difference metric, I’ve observed some notable peaks in previous market cycles. In particular, the metric reached 130% in 2013, 87% in 2017, and 69% in 2021 at their respective cycle highs. However, it’s important to note that the highest reading I’ve encountered during this current market cycle was only 41%.

Based on current trends, it’s plausible that Bitcoin’s price may surpass its previous all-time high from March. Given the disparities in indicators between this cycle and the one in 2021, there’s a strong possibility that Bitcoin could reach an astounding $85,000 price point.

Read Bitcoin’s [BTC] Price Prediction 2024-2025

Although the coin has the potential to rise further, reaching a $100,000 valuation may prove challenging.

If the price reaches a significant milestone, it’s beneficial for investors. On the contrary, even if it doesn’t, some Bitcoin enthusiasts may still view it as an attractive opportunity.

2024-05-20 17:12

It’s bulls over bears again

$85,000 is almost a sure bet

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