Is the Bitcoin bear market over?
Updated
The Bitcoin market has broken above 30k in recent weeks, posting the strongest Quarterly returns (+70%) since the Oct 2021 ATH. This has also been the second time weekly returns have reached +35%, firmly placing Bitcoin as the best performing asset class YTD, once again.the strong market performance in 2023 is a stark contrast to 2022, and suggests a favorable regime shift is under way. In this report, we will explore several on-chain indicators which support this notion, and help to assess whether a robust recovery from a bear market is in play, and if the bear market may well be behind us.
An interesting development over the last 12 months has been the increased correlation between the performance of BTC prices, relative to Gold, the traditional sound money safe haven. On a 30day, 90day, and 365day basis, the correlation between these two assets is now strongly positive, remaining elevated during the recent US banking crisis a few weeks ago.
We can also view the current market cycle from the lens of Long-Term Holder behavior, expressed via changes in their held Supply. We can see three key phases:
-Plateau of Patience, where LTH supply tends to hover around its ATH, often from several months, to over a year.
-Peak HODL, where LTH supply in profit (dark blue) rises rapidly, and is usually associated with a run-up in prices towards the ATH.
-Distribution upon Breaking ATH, where LTHs start to distribute heavily into waves of new demand that are entering the market.
The market currently sits well within the Plateau of Patience, with over 23.3% of the supply held outside exchanges owned by LTHs who are underwater on their position. The current supply structure also has many similarities to early 2016 and early 2019. we can see that the YTD market strength is supported by an explosive uptick in coins held at a profit. Bear market floors are characterised by wide-scale capitulation, which by definition, has an equal and opposite inflow of demand to absorb it.
As price rallies out of the bottom formation zone, all of these coins return to profit. In 2023, a total of 6.2M BTC have returned to profit (32.3% of supply), giving an indication of just how large this cost basis foundation is below 30k. with so many coins returning to an unrealized profit, it follows that the incentive to spend and sell will start to rise. The popular NUPL metric provides a measure of how much of the Bitcoin market cap is held as an unrealized profit.
At the current reading of 0.36, the market is at a very neutral level, with 55.8% of days recording a higher reading, and thus 44.2% being lower. This is coincident with past cycles where a transition between a bear and bull markets have taken place. It also suggests that the market is neither heavily discounted (like it was at 16k), nor heavily overvalued (like at the 60k+ peak).whilst HODLers are often associated with coin dormancy, the Bitcoin network remains very much alive with activity. Organic transaction counts are now over 270k/day, which is approaching cycle, highs on a monthly average basis.
the daily 50, 200 EMA crossed at 21k which shows the down trend end and now bulls are in control but the volume is a bit down which shows bulls wants to buy BTC at cheaper price so they waiting for corrections
An interesting development over the last 12 months has been the increased correlation between the performance of BTC prices, relative to Gold, the traditional sound money safe haven. On a 30day, 90day, and 365day basis, the correlation between these two assets is now strongly positive, remaining elevated during the recent US banking crisis a few weeks ago.
We can also view the current market cycle from the lens of Long-Term Holder behavior, expressed via changes in their held Supply. We can see three key phases:
-Plateau of Patience, where LTH supply tends to hover around its ATH, often from several months, to over a year.
-Peak HODL, where LTH supply in profit (dark blue) rises rapidly, and is usually associated with a run-up in prices towards the ATH.
-Distribution upon Breaking ATH, where LTHs start to distribute heavily into waves of new demand that are entering the market.
The market currently sits well within the Plateau of Patience, with over 23.3% of the supply held outside exchanges owned by LTHs who are underwater on their position. The current supply structure also has many similarities to early 2016 and early 2019. we can see that the YTD market strength is supported by an explosive uptick in coins held at a profit. Bear market floors are characterised by wide-scale capitulation, which by definition, has an equal and opposite inflow of demand to absorb it.
As price rallies out of the bottom formation zone, all of these coins return to profit. In 2023, a total of 6.2M BTC have returned to profit (32.3% of supply), giving an indication of just how large this cost basis foundation is below 30k. with so many coins returning to an unrealized profit, it follows that the incentive to spend and sell will start to rise. The popular NUPL metric provides a measure of how much of the Bitcoin market cap is held as an unrealized profit.
At the current reading of 0.36, the market is at a very neutral level, with 55.8% of days recording a higher reading, and thus 44.2% being lower. This is coincident with past cycles where a transition between a bear and bull markets have taken place. It also suggests that the market is neither heavily discounted (like it was at 16k), nor heavily overvalued (like at the 60k+ peak).whilst HODLers are often associated with coin dormancy, the Bitcoin network remains very much alive with activity. Organic transaction counts are now over 270k/day, which is approaching cycle, highs on a monthly average basis.
the daily 50, 200 EMA crossed at 21k which shows the down trend end and now bulls are in control but the volume is a bit down which shows bulls wants to buy BTC at cheaper price so they waiting for corrections
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Bitcoin hashrate is up over 70% from a year ago and the network has never been this strong beforeNote
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After the options delivery ended today, the prices of BTC and ETH fell sharply. Meanwhile, ETH saw more than 30,000 block puts, mainly OTM puts at the end of the month, accounting for 15% of the day's volume. BTC was dominated by selling calls, with overall major term IVs being relatively stable and market sentiment calm.Note
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crypto volume’s look encouraging, particularly when grouping by quarter. Q1 2023 was the second highest volume quarter everNote
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The U.S. comprehensive PMI rose to an 11-month high in April, and purchase prices and ex-factory prices hit five-month and seven-month highs. Economists warned that the CPI could rise. After the PMI announcement, US stocks fell sharplyNote
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Bitcoin Hodler Moves 400 Bitcoin Worth 11 Million dollar For First Time After 2011, i.e 12 Years Of InactivityNote
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Bitcoin price jumps in the wake of First Republic Bank price crashNote
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On April 29, the number of transactions on the Bitcoin blockchain (7d Moving Average) reached 426,337.14, a record high, which may be related to the demand from Inscriptions. On April 29, the number of Bitcoin Inscriptions minted in a single day exceeded 20,000 for the first time, setting a new highNote
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Bitcoin hit a new all-time high in daily transactions 7MA, with continued on-chain activity attributed to inscriptions. the number of daily transactions surged beyond 568,300 on Sunday alone, which is nearly 78,000 more than its previous peak in 2017Note
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The Federal Reserve will announce its interest rates soon
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FOMC in 30 minNote
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Banks fails, Bitcoin savesNote
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According to glassnode, a total of 75.77% of Bitcoin on-chain transactions used Taproot on May 7, a record high, compared to only 1.536% at the beginning of the year. The increase in Taproot adoption means that block sizes are increasing, resulting in an increase in transaction costs.Note
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The vast majority of the casualties were long positions last days, with more than 763M liquidated in totalNote
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Today, 12:30 UTC CPI data is coming outGet ready for high volatility
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1 hour till CPI data release, what's your prediction?Note
U.S. CPI: +4.9% YEAR-OVER-YEAR (EST. +5%)U.S. CORE CPI: +5.5% YEAR-OVER-YEAR (EST. +5.5%)
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The price of Bitcoin is $27,460 today with a 24hour trading volume of 8.6 billion dollar. This represents a -3% price decline in the last 24 hours and a -6% price decline in the past 7 days
We have a Head & Shoulders pattern completed on daily and we are testing the neckline of the one, looking for a correction to 25k in case we break below the neckline and confirm the pattern
we have two important support levels, the orange line which shows the daily uptrend and blue one at 27k
bulls lost point of control at 28k and today candle is under EMA 50
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we hit 25780
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wait for rejection or breakout
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BTC's rolling correlation with ETH has weakened from 96% to 77% since mid-March — its lowest level since November 2021. Since the Shapella upgrade, ETH dropped by nearly 14% while BTC is down by around 11%. Overall, both BTC and ETH seems increasingly driven by divergent idiosyncratic factorsNote
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if break 27500 then be ready for 27700
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what a rejection
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Trade closed: target reached
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