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Breaking News: Coinbase Confirms DOJ Investigation Following Major Security Incident

Bitcoin “Still In A Bull Market,” Quant Says—Here’s Why

Keshav Verma
Keshav Verma
9 months ago
2 mins read
Bitcoin

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A quant has explained why Bitcoin still appears inside a bull market based on the pattern observed in this on-chain indicator.

Bitcoin IFP Is Currently Signaling A Bull Market

In a CryptoQuant Quicktake post, an analyst discussed the trend in the Bitcoin Interexchange Flow Pulse (IFP). The IFP here refers to an on-chain metric measuring the flow of tokens from spot exchanges to derivatives.

When the value of this indicator goes up, the amount of BTC moving from spot to derivatives platforms rises. Such a trend implies that investors want to open more positions in the derivatives market and show their willingness to take on higher risk.

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On the other hand, the metric registering a decline could suggest a lower appetite for risk among the investors, as they are shifting a lesser amount to derivatives wallets.

Now, here is a chart that shows the trend in the Bitcoin IFP over the past few months:

Bitcoin IFP
Looks like the value of the metric has been on the rise in recent days | Source: CryptoQuant

As displayed in the above graph, the Bitcoin IFP had declined to relatively low levels in mid-July, but the indicator has witnessed an upward trajectory since then. This would imply that while investors had become risk-averse last month, they have started to become bold again.

In the same chart, the quant has also attached the indicator’s 90-day simple moving average (SMA). Historically, the interactions of the metric with this line have proven to be significant for the cryptocurrency.

During the period of low values earlier, the IFP had been below its 90-day SMA, which has been a bearish signal in the past. The indicator has recently reclaimed the level with its surge, suggesting a flip towards a bullish mentality.

Below is another chart for the Bitcoin IFP, but this time, it zoomed out to showcase the pattern the asset has followed during past cycles.

Bitcoin IFP Historical Trend
The signal that the metric has given during past bullish periods | Source: CryptoQuant

The graph shows that the Bitcoin IFP saw just one temporary drawdown below its 90-day SMA during the leadup to the 2017 bull run, while the first-half 2021 bull run didn’t see any red signals at all.

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Interestingly, the second half of the 2021 bull run mostly occurred with red values, meaning that from the perspective of this indicator, the run may have already been doomed from early on.

The indicator has given a bearish signal twice in the current cycle. Still, given that it has returned to green each time, it’s possible that these were only temporary deviations like during the 2017 cycle, and the bull run isn’t over yet.

BTC Price

At the time of writing, Bitcoin is trading at around $58,600, down 2% over the past 24 hours.

Bitcoin Price Chart
The price of the asset appears to have been stale during the last few days | Source: BTCUSD on TradingView
Featured image from Dall-E, CryptoQuant.com, chart from TradingView.com
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Keshav Verma
Keshav Verma

Keshav Verma

Keshav is currently a senior writer at NewsBTC and has been attached to the website since June 14, 2021.

Read more

Keshav has been writing for many years, first as a hobbyist and later as a freelancer. He has experience working in a variety of niches, even fiction at one point, but the cryptocurrency industry has been the longest he has been attached to.

In terms of official educational qualifications, Keshav holds a bachelor’s degree in Physics from one of the premier institutes of India, the University of Delhi (DU). He started the degree with an aim of eventually making a career in Physics, but the onset of COVID led to a shift in plans. The virus meant that the college classes had to be delivered in the online-mode and with it came free time for him to explore other passions.

Initially only seeking to make some beer money, Keshav unexpectedly landed clients offering real projects, after which there was no looking back. Writing was something he had always enjoyed and to be able to do it for a living was like a dream come true.

Keshav completed his Physics degree in 2022 and has been focusing on his writing career since, but that doesn’t mean his passion for Physics has ended. He eventually plans to re-enter university to obtain a masters degree in the same field, but perhaps only to satiate his own interest rather than for using it as a means to find employment..

Keshav has found blockchain and its concepts fascinating ever since he started going down the rabbit-hole back in 2020. On-chain analysis in particular has been something he likes to research more about, which is why his NewsBTC pieces tend to involve it in some form.

Being of the science background, Keshav likes if concepts are clear and consistent, so he generally explains the indicators he talks about in a bit of detail so that the readers can perhaps come out having understood and learnt something new.

As for hobbies, Keshav is super into football, anime, and videogames. He enjoys football not only as a watcher, but also as a player. For games, Keshav generally tends towards enjoying singleplayer adventures, with EA FC (formerly FIFA) being the only online game he is active in. Though, perhaps due to being ultra-focused on the game, he is today a semi-pro on the EA FC scene, regularly participating in tournaments and sometimes even taking back prize money.

Because of his enthusiasm for anime and games, he also self-learned Japanese along the way to consume some of the untranslated gems out there. The skill didn’t merely remain as just a hobby, either, as he put it to productive use during his exploration for small-time gigs at the start of COVID, fulfilling a couple of Japanese-to-English translation jobs.

Keshav is also big into fitness, with agility and acceleration-related workouts making a big part of his program due to the relevance they have in football. On top of that, he also has a more traditional strength based program for the gym, which he does to maintain an overall fitness level of his body.

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Disclaimer: The information found on NewsBTC is for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.

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Reason to trust

Strict editorial policy that focuses on accuracy, relevance, and impartiality
Created by industry experts and meticulously reviewed
The highest standards in reporting and publishing
How Our News is Made

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