Bitcoin (BTC) On-Chain Indicators Support Continuation of Uptrend

BeInCrypto takes a look at Bitcoin’s on-chain indicators, specifically the Spent Production Profit Ratio (SOPR), RHODL Ratio, and the Stock-to-Flow Deflection (STF) caral.

Bitcoin SOPR

SOPR is a chain indicator that shows whether the market is in a profit or loss state. Readings above a (black line) show that the market is in aggregate profit, while those below one show an aggregate loss.

SOPR fell below one for the entire period from May to July. However, the continued rise of BTC has caused the indicator to return to profit.

More importantly, the SOPR bounced off a line in September (blue circle) and has risen since then.

Previously, such bounces (black circle) were the catalyst for considerable bullish movements.

This could occur due to a false sale, where weak hands are forced out of the market before the uptrend resumes.

RHODL report

RHODL ratio is an indicator created by taking the ratio between the 1 week and 1-2 year HODL wave bands. Values ​​above 50,000 (highlighted in red) suggest that a significant percentage of the BTC supply is in the hands of short-term holders. Historically, these values ​​have coincided with the highs of the market, as happened in the peaks of 2013 and 2017.

previous annual high in 2021 emerged in February with a value of 13,812. This was significantly below the overbought region. RHODL has now moved above its February highs, above 14,000.

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However, compared to previous market cycles, it still has ample room to grow into overbought territory.

Stock-to-flow (STF) caral

STF deflection measures the difference between the STF Model and the price of bitcoin (BTC).

Values ​​greater than one (indicated by the red line) suggest that compared to the caral, BTC is overvalued. Values ​​below one (indicated by the green line), on the other hand, show an underestimation.

indicator provides values ​​in report form. refore, a value of 0.5 means that the price of BTC is 0.5 times the price predicted by the caral, while a value of 1.5 means that the price is 1.5 times that given by the caral.

In July (black circle) the indicator returned a value of 0.314, the lowest in the last ten years. This was a sign of extreme understatement of the caral. STF subsequently rallied on October 2 (blue circle) and has since risen.

current value of 0.6 still shows that BTC is undervalued, despite the significant increase.

Historically, values ​​greater than 1 have coincided with local and cyclical highs.

For the latest Bitcoin (BTC) analysis from BeInCrypto, click here.


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