Bitcoin (BTC) remains bullish, with three price metrics showing “insane” similarities to its 2020 breakout, according to Glassnode co-founders Yann Allemann and Jan Happel. They highlighted that the metrics, including the relative strength index (RSI), are reminiscent of Q3 2020, just before BTC beat its 2017 all-time high of $20,000.
The daily RSI of BTC/USD currently measures around 35, its lowest reading since early March, prior to the increase that led to the highest peak of $31,000 a month later. The Glassnode co-founders stated that the RSI is at levels that led to significant reversals and rallies in the past.
The second metric, Cipher B readings for Bitcoin, derive from a set of algorithms that provide signals when to buy dips during bull markets. Just like the RSI, Cipher B wave trends are at levels that have previously led to major reversals and rallies.
Lastly, the Bitcoin Risk Signal, which predicts the likelihood of a significant BTC price drawdown, is back at its September 4, 2020 position. Despite a spike to “high risk” before receding, the Risk Signal reading remained flat for successive months while BTC/USD surged higher.
Besides the compelling metrics, Glassnode also noted encouraging signs among long-term investors and existing hodlers. Wallets with less than 100 BTC are adding to their balance at a rate 248% greater than the amount freshly minted by miners. Furthermore, sharks (100 to 1k BTC) are adding an additional 38%, and coins are coming out of exchanges.
These observations are promising for those who have faith in the long-term prospects for Bitcoin. However, investors should be aware that the cryptocurrency market remains an unpredictable and volatile space, as market sentiment can change rapidly. Investment decisions should be made after thorough research and risk assessment, taking into account factors such as market developments, emerging technologies, and external events.
Source: Cointelegraph
