Bitcoin Puell Multiple Lifts Off From Buy Zone, Bull Momentum To Follow?

Keshav Verma

1 year ago

3 mins read

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On-chain data shows the Bitcoin puell multiple has started to leave the “buy” zone, a sign that the crypto may be heading towards bullish momentum.

Bitcoin Puell Multiple Has Gone Up In Value During Recent Days

As pointed out by an analyst in a CryptoQuant post, the BTC puell multiple is currently breaking out of the historic buy zone.

The “puell multiple” is an indicator that measures the ratio between the daily miner revenues (in USD) and the 365-day moving average of the same.

What this metric’s value tells is how much Bitcoin miners are currently making compared to the average for the past year.

When the value of the indicator rises, it means miner revenues are going up right now. This leads to miners becoming more likely to sell and the price may be called “overvalued.”

On the other hand, decreasing values of the metric can suggest the price is becoming more undervalued as miner revenues are moving down.

Now, here is a chart that shows the trend in the Bitcoin puell multiple over the last several years:

The value of the metric seems to have observed some rise recently | Source: CryptoQuant

As you can see in the above graph, the Bitcoin puell multiple was in the “buy” zone until just a little while ago.

Historically, this zone with indicator values less than 0.5 has been a sign that the price of the crypto is currently undervalued. Bear bottom formations have taken place here.

There is also an opposite area, the “sell” zone, which represents values of the multiple greater than 4. Naturally, BTC is overvalued in this region.

Very recently, the puell multiple has seen some uplift and has now just broken out of the green zone. During the past, this has usually been a sign that the crypto is now heading towards bullish momentum.

One thing should be noted, however, that in the past a breakout from the region doesn’t mean a rally would necessarily begin immediately. There could still be a few more months of buildup before a proper run can begin.

BTC Price

At the time of writing, Bitcoin’s price floats around $21.9k, down 1% in the last seven days. Over the past month, the crypto has gained 3% in value.

The below chart shows the trend in the price of the coin over the last five days.

Looks like the value of the crypto has sunk down during the last few days | Source: BTCUSD on TradingView

After holding above $22k for about a week, Bitcoin seems to have dipped below the level over the past 24 hours.

Featured image from Kanchanara on Unsplash.com, charts from TradingView.com, CryptoQuant.com

Keshav Verma

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

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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