Bitcoin Bull Run Analysis: Positive Outlook for Investors
After Monday’s market crash, concerns have arisen regarding the stability of Bitcoin’s bull run. However, Ki Young Ju, the founder and CEO of CryptoQuant, remains optimistic. He suggests that despite the recent crash, on-chain data continues to support the notion that the bull market for Bitcoin remains intact.
Bitcoin On-Chain Analysis: Bullish Arguments
#1 Bitcoin Hashrate
Bitcoin’s hashrate, which measures the computational power used in mining and processing transactions, is approaching an all-time high. Ju points out that miner capitulation is almost over, with the hashrate nearing ATH. He mentions that US mining costs are around $43K per BTC, so the hashrate is likely to remain stable unless prices drop below this level.
#2 Whale Behavior
Significant Bitcoin inflows into custody wallets indicate strong accumulation by large-scale investors, known as ‘whales’. Ju emphasizes the increase in BTC inflows into custody wallets and the rise in Permanent Holder addresses, including investment in US spot ETFs over the past 30 days. New whales are actively accumulating.
#3 Retail Investor Participation
The current low involvement of retail investors resembles patterns seen in mid-2020. Ju notes that retail investors are currently less active, which may contribute to lower volatility in the market, as retail trading often leads to swift price fluctuations.
#4 Old Whales Still Holding
In the period between March and June, long-term holders transferred their Bitcoin holdings to new investors. Currently, there is no significant selling pressure from these veteran holders, indicating a confidence in holding onto their assets.
Bearish On-Chain Data
#1 Macro Risks
Ju highlights macroeconomic risks and recent market activities that could affect the price stability of Bitcoin. There have been large crypto deposits by Jump Trading recently, as well as a peak in daily deposits on Binance. These factors could lead to forced sell-offs and impact the market negatively.
#2 Borderline On-Chain Indicators
While some on-chain indicators have started to show bearish signals, Ju suggests that these are currently on the borderline. If these bearish trends persist for more than two weeks, recovering from the market downturn could prove challenging.
#3 Bull-Bear Cycle Indicator Flags Bear Phase
The Bull-Bear Market Cycle Indicator has signaled a bear phase for the first time since January 2023, indicating a potential shift in market sentiment. This indicator has accurately predicted bear phases during significant market events in the past, emphasizing the need for close monitoring of this trend.
Despite these potential bearish indicators, Ju maintains a cautious optimism regarding Bitcoin’s ability to achieve a new all-time high by the end of the year. He suggests that as long as the Bitcoin price remains above $45K, there is a possibility of breaking the all-time high within a year. Ju advises observing the market closely for signs of recovery or prolonged bearish trends to make informed decisions.
As of the latest update, BTC is trading at $56,639.
Hot Take: Stay Informed and Stay Vigilant
As a crypto investor, it is essential to stay informed about the latest market trends and on-chain data to make strategic investment decisions. While the market may experience fluctuations, being vigilant and proactive can help you navigate through potential challenges and opportunities. Remember to do your research, consult reliable sources, and stay updated on the evolving landscape of the crypto market to make informed choices.
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