Call the bottom Bitcoin is not an easy task. Prices tend to fall more dramatically and faster than anyone is prepared for and it’s the investment equivalent of catching a falling knife.
But if anyone is able to accurately get to the bottom in crypto, it’s Charles Edwards, fund manager and Bitcoin fundamentals expert, responsible for creating some of the most famous tools in crypto.
Meet the creator of the most profitable Bitcoin buy signal
While you may not know Charles Edwards by name, you may have heard of some of his tools before. The Hash Ribbonsonce known as the most profitable signal in Bitcoin ever, belongs to its custom toolset of crypto-specific indicators.
In a recent Twitter threadEdward reveals a series of on-chain signals that make a strong case for why the bear market could be bottoming in crypto.
Arguments put forward include the price per BTC falling below the electrical cost of generating each coin, plus the long-term MVRV-Z score and NUPL are at previous bear market lows.
Bitcoin briefly traded below its electrical cost | Source: BTCUSD on TradingView.com
On-Chain Cases for the bottom of the bear market that is in
Entity-adjusted quiescent current is at an all-time low and we’ve hit the third-highest BTC miner stress event on record. Past events were back as BTC traded at USD 290 and USD 2. Bitcoin Energy Value also has the highest price discount it has ever seen.
Entity-adjusted dormancy flow is at the lowest level ever | Source: Glassnode
Edwards also cites that stablecoin capital has been sidelined in USDT and USDC and has not left the industry because of FTX – it is just waiting for a turnaround to re-enter safely. He also points to miner capitulation in the Hash Ribbons.
The only problem is that the last time the tool was activated, the previously profitable signal did not produce any positive results for the first time since it was made. Will this signal redeem the indicator?
Will this coming buy signal do the trick? | Source: BTCUSD on TradingView.com
Bitcoin’s price is trading at around $17,000 per coin, or about 77% lower than all-time highs. Previous withdrawals ended at 96%, 86% and 84%. What will be the final figure for this market cycle?
Featured image from iStockPhoto, Charts from TradingView.com