Bitcoin on-chain metric suggests 2017-style bull run will continue

If there’s one thing that the cryptocurrency market has learned, it is to never count out Bitcoin. The digital coin’s performance in 2017 was astounding, with BTC reaching highs of nearly $20K for a brief period at its peak. Experts are set on predicting how high this whale could go next year – but whether or not they’re right will depend on what happens when 2018 begins.

Bitcoin on-chain metrics show that the 2017-style bull run will continue. The “btc short squeeze” is a term used to describe how investors are betting on Bitcoin by buying up the cryptocurrency and selling it for a higher price.

According to an indicator that seeks to anticipate market bottoms and peaks, Bitcoin’s (BTC) decline from its record high of $67,000 to below $60,000 hasn’t discouraged bulls from expecting another peak level ahead.

The risk measure, dubbed MVRV, reflects the ratio of Bitcoin’s market value to its realized value, akin to the P/B ratio, which compares a company’s market value to its book value. MVRV aims to determine if an asset is undervalued or overpriced in this way.

A bullish setting similar to that of 2017.

A MVRV value of more than 3.7 indicates that Bitcoin is going to max out, causing selloffs. An MVRV reading below one, on the other hand, indicates that there is buying pressure on the possibility of Bitcoin bottoming out.

MVRV has aided Bitcoin traders in detecting selling and purchasing forces in the Bitcoin market in the past. The orange overlays in the image below, for example, indicate the link between the price of Bitcoin and its MVRV production.

MVRV vs. Bitcoin pricing. CryptoQuant is the source of this information.

In a recent Stack Funds analysis issued on Nov. 4, head of research Lennard Neo stated that the current MVRV recovery is similar to the one seen during the 2017 bull run, generating a series of higher highs and higher lows (green) as the Bitcoin price increases.

MVRV also recovered in a similar fashion following the May 2021 price fall, dipping below 1 to signal the Bitcoin market’s undervaluation at the time. The measure rebounded nicely, making higher highs and lower lows, confirming Bitcoin’s advance.

“With MVRV now trading at 2.72, considerably behind its last top of 3.96 in February, we foresee more opportunity for growth as it re-tests the 4.0 handle,” Neo said in a research dated Nov. 4 in which he added:

“If the MVRV rise continues in the near future, Bitcoin’s top will be a long time coming.”

Is Bitcoin on its way to $70,000?

Bitcoin’s recent ability to maintain $60,000 as a support level, according to Neo, shows that it is eager to retest $67,000 — or perhaps extend the bullish advance into $70,000.

In addition to MVRV, the analyst provided two on-chain measures to illustrate his positive forecast. This includes measures that monitor Bitcoin balances across all crypto exchanges and wallets with big BTC token holdings. 

In specific, the total Bitcoin owned by exchanges throughout the globe fell to 2.311 million BTC, the lowest level in almost three years.

1636043417_686_Bitcoin-on-chain-metric-suggests-2017-style-bull-run-will-continueBitcoin reserve balances across all exchanges. CryptoQuant is the source of this information.

As the Bitcoin price rebounded from its May-July 2021 fall, the top investors intensified their buying binge.

The so-called whales — addresses with 10,000 to 100,000 BTC – upped their Bitcoin purchasing throughout the rebound from sub-$30,000 following July, according to Glassnode’s Whale Supply Shock indicator.

Bitcoin-on-chain-metric-suggests-2017-style-bull-run-will-continueSupply Shock for Bitcoin Whales. Glassnode is the source of this information.

It’s a symptom of “a multi-month accumulation rally,” according to Dor Shahar, an on-chain analyst at CryptoJungle, who predicts more record highs for Bitcoin as whales remove more BTC supply from circulation.

Bitcoin whale indicator indicates multi-month accumulation tendency as BTC heads for a retest of $67K

“The ratio between the two groups, whales and other fishes, provides a gauge of supply dynamics,” he said, adding:

“As a result, [the indicator] may aid in visualizing the supply shortfall that coins held by whales might produce, as well as the price impact. A more sensitive macro top indicator is also included.”

The author’s thoughts and opinions are completely his or her own and do not necessarily represent those of Every investing and trading choice has risk, so do your homework before making a decision.

Bitcoin on-chain metric suggests 2017-style bull run will continue. There are many reasons for this, but the most important one is that Bitcoin Cash (BCH) has been gaining traction in recent weeks. Reference: hodl eth or btc.

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