Key Points
- The Pi Cycle Top indicator suggests Bitcoin (BTC) is near its market bottom, hinting at a possible trend reversal.
- Bitcoin’s MVRV ratio analysis indicates a potential rise, which could lead to Bitcoin reaching $120k in the coming months.
The Pi Cycle Top indicator has indicated that Bitcoin (BTC) is nearing its market bottom, suggesting a potential reversal in the current bearish trend. Both daily and weekly charts for Bitcoin have remained red, but recent analysis points to a possible change in this trend.
Predicting a Bitcoin Rise
Bitcoin experienced a 3% price drop last week and its bearish trend continued into the last 24 hours. However, an analysis by CryptoQuant hinted at a major rally on the horizon. The analysis considered Bitcoin’s MVRV ratio, which stood at around 2, indicating that the market surface value was double the estimated on-chain value. This analysis suggests that an upward trend remains intact, with a cycle peak typically occurring when the MVRV reaches levels between 3 and 3.6. According to this, a 43%-77% rise is required if the realized value stays the same, which could mean Bitcoin reaching up to $120k.
Data from Glassnode’s Pi Cycle Top indicator suggested that Bitcoin’s price was quickly nearing its potential market bottom of $62.7k. This information, along with the CryptoQuant analysis, makes the prospect of Bitcoin reaching $120k in the coming months seem plausible.
Short-term Prospects for Bitcoin
While the future for Bitcoin appears optimistic, the current situation is less certain. On-chain data analysis revealed that Bitcoin’s binary CDD turned red, indicating that long-term holder movement in the last 7 days was lower than average. This suggests that these holders are motivated to keep their coins. The NULP was also bearish, indicating that investors are in a high unrealized profit state. At the time of writing, Bitcoin was testing its resistance at its 20-day Simple Moving Average (SMA). A successful breakout could trigger a bull rally, but a rejection could result in Bitcoin falling to $65k again.
