
30-day exponential moving average of the number of bitcoin that are “in profit” – ie were acquired at a time when B T c Price was low – reached 2 month high on 19thth According to crypto data and on-chain analytics firm Glassnode as of January.
In view of the latest bitcoin rally Glassnode’s 30-day EMA sees bitcoin supply gain more than 10.5 million coins has gone. This is its highest level since last September. Currently, there are 19.27 million bitcoins in circulation out of a total of 21 million that can be mined at any given time.
As a result, Glassnode says that the profit supply trend is now positive. The crypto analytics firm explains, “During positive market trends, the amount of BTC supply acquired at lower prices increases, turning the excess supply into an unrealized profit.”
“Thus, profit may signal a macro trend shift in the quantity supplied when a heavy concentration of investor cost basis has recently transitioned between unrealized gains or losses,” says Glassnode. “Often these occur near macro market cycle reversals”.

Supply in profit at highest level since May 2022
The above indicator uses the EMA to produce less volatile results, which potentially act as a better indication of a turning point in the market. But a more fundamental measure of gains in supply is also sending a bullish signal.
According to Glassnode, 66.9% of bitcoins were in profit on Thursday the 19thth in January, up from about 50% at the end of the year. This means that approximately 12.9 million bitcoins were moved last time the price was lower.

Given Glassnode’s long-term history of the gain metric in more basic supply, recoveries of less than 50% often precede the start of a bull market.

Other signals are also flashing green
Several other technical and on-chain indicators are starting to glow green that the bear market of 2022 may be over. For example, of bitcoin The latest push higher that has seen it recover from late-2022 lows of $17,000 to above $21,000 saw the world’s largest cryptocurrency by market capitalization back north of its 200-day moving average and realized value, both of which are $ Sits under 20,000.

Momentum in new addresses also took a turn for the better recently, with the 30-day simple moving average (SMA) recently jumping above the 200-day SMA, a change that often occurs at the start of a bitcoin bull market. Is.

Meanwhile, according to analysis by the pseudonymous Twitter account @CryptoHornHairs, bitcoin is tracking in line with long-term market cycles that repeat roughly every four years. According to @CryptoHornHairs, Bitcoin is at the beginning of the bullish phase of the cycle, just coming after 364 days of downtrend.
But beware bulls, fees are not revenue from momentum
Glassnode’s revenue to fee multiple still has a negative 2-year Z-score of approximately -0.41. The Z-score is the number of standard deviations above or below the mean of the data sample. In this example, Glassnode’s Z-score is the number of standard deviations above or below the average bitcoin fee revenue over the past 2-years.
“Sustained growth in fee revenue as a proportion of total reward indicates that bitcoin blocks are full, and demand for transaction activity is increasing,” said the crypto analytics firm. “Given bitcoin’s constrained block size, this has historically provided a valuable early indicator of macro trend shifts in the network demand profile”. Bitcoin’s weak fee revenue momentum should be a red flag for bulls, as it reflects weak on-chain activity.
So where’s next for BTC?
Therefore, all signs are not yet there to indicate a sustained bullish bitcoin rally. But the bulls should not be afraid. 2023 is (probably) going to be nothing like 2022. In the US Inflation and Growth Inflation is easing rapidly and the bulk of the US Federal Reserve’s interest rate hike cycle is already complete. Markets and many analysts still expect the world’s most important central bank to make only a few more hikes in 2024 despite hawkish talk and then a comfortable bias.
Many crypto analysts expect that the deleveraging cycle that has seen the fall of many industry titans from Three Arrows Capital, Celsius, FTX and most recently Genesis is nearing maturity. Analysts are also expecting positive regulatory developments this year in key markets such as the US, such as a resolution on the SEC vs. Ripple lawsuit and further progress towards a comprehensive crypto regulation bill.
It is probably unfair to expect the momentum of this month’s rally to continue, but a sustained crawl higher (assuming no further economic/industry shocks) may well be on the cards. In the near term, a break above $21,500 will open the doors for a rally towards the key $25,500 balance zone.

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