Indicators Show Bitcoin Might Be Gearing Up For One Last Push Up

Keshav Verma

3 years ago

3 mins read

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

Strict editorial policy that focuses on accuracy, relevance, and impartiality

Ad discliamer

Morbi pretium leo et nisl aliquam mollis. Quisque arcu lorem, ultricies quis pellentesque nec, ullamcorper eu odio.

Some Bitcoin indicators show similarities between the post-ATH price action and current trend, implying that there will be one last push up before a bigger drop.

Indicators Might Show Today’s Price Action Is Similar To That After $64.5k ATH

As explained by a CryptoQuant analyst, there seem to be many similarities between the Bitcoin indicators of the post all-time-high (ATH) period and that of present day.

There are three main metrics of relevance here. The first is the exchange reserve, which shows the amount of BTC currently being held on centralized exchange wallets.

Here is how this indicator’s value has changed during the past year:

The BTC exchange reserve after the ATH vs today

Looking at the above graph, there does seem to be a similarity between the two periods. Both had declining prices as well as declining exchange reserves.

Next is the estimated leverage ratio, an indicator that shows how much leverage is used by traders on average. It’s calculated by taking the open interest divided by the exchange reserve.

The leverage ratio seems to be plunging down

Here too a similarity can be seen as the indicator seems to have sharply dropped down during both present day and the post-ATH period.

Finally, there is the Spent Output Profit Ratio (SOPR), which is calculated by taking the ratio of realized value (in USD) to the value of creation of a spent output.

In simpler terms, the indicator shows whether Bitcoin wallets are selling their coins at a profit or a loss. The below chart shows the trends for this metric.

The BTC SOPR over the past six months

Looks like the value of the SOPR dropped down below 1 during both these periods. Such a value indicates that investors have been selling BTC at a loss (while values above 1 would imply the opposite).

If the current trend really is similar to the post-ATH one as these indicators would seem to imply, then it means BTC’s price might move up soon and make a local peak. And just like last time, a big drop could happen after that which takes the price to lower levels. So that this uptrend could turn out to be the last move up for a while.

BTC Price

At the time of writing, Bitcoin’s price floats around $45.7k, down 10% in the last 7 days. Over the past month, the cryptocurrency has dropped 1% in value.

Here is a chart showing the trend in the price of the coin over the last three months:

Bitcoin's price moves sideways after a big plunge downwards | Source: BTCUSD on TradingView

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

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.

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.