DEC 14, 2023
Charting Bitcoin's Shift to a Bull Market
by Hx6J..jK9W, Tarek On-Chain
Bull Market, Bitcoin, Crypto
Does the bear market for Bitcoin finally seem to be concluding? Are we on the cusp of entering a new bull cycle? To answer these pivotal questions, we'll delve into an analysis using three crucial indicators: Net Unrealized Profit/Loss (NUPL), MVRV Ratio, and Puell Multiple.
These indicators are instrumental in deciphering Bitcoin's market cycles and currently point towards interesting developments in the cryptocurrency's trajectory.
Net Unrealized Profit/Loss (NUPL):
NUPL is a measure of the market's profit or loss state.
A rising NUPL, moving from neutral to 'greed,' indicates an increasingly profitable market, often correlating with bullish sentiment.
The current trajectory of NUPL suggests an uplift in market optimism, which is a typical precursor to a bull market.
The MVRV Ratio compares Bitcoin's market cap to its realized cap.
A low MVRV ratio often indicates an undervalued state, common in bear markets.
The recent upward movement in the MVRV ratio from these lower levels may signal that the market is transitioning from undervaluation to a phase where growth is anticipated, hinting at the start of a bull cycle.
This metric relates the daily issuance value of Bitcoin in USD to its 365-day moving average. Historically, lower values of the Puell Multiple have indicated market bottoms, suggesting optimal buying points and potential for an upcoming bull run.
A gradual increase in this multiple from its lower levels can be interpreted as a reduction in selling pressure and increased profitability for miners, aligning with the potential onset of a bull cycle.
In conclusion, the current readings of NUPL, MVRV Ratio, and Puell Multiple collectively imply that the bear market for Bitcoin may be subsiding, making way for the early stages of a bull cycle.
However, It's important to remember that corrections in the price are always possible, and other economic factors, can significantly influence market behavior.