Closely followed crypto analyst Benjamin Cowen says a historically reliable on-chain indicator is suggesting that the bottom is here or very close for Bitcoin (BTC).
In a new interview with Kitco News, Cowen pulls out Bitcoin’s supply in profit and loss chart, which shows what percentage of BTC coins are giving their holders a profit or a loss.
The popular analyst says that the supply in profit and loss metric for BTC has historically coincided with long-term tops and bottoms.
Cowen also says that if BTC sees another leg down or perhaps a capitulation event, this indicator would strongly suggest that the bottom is in.
“Some of the charts that I think are the most interesting are things like the supply in profit and loss. One of the interesting things about this chart is that historically, Bitcoin does not bottom until after they cross. Until after they cross.
They crossed yesterday. For the first time this cycle, they crossed yesterday. And you can see a very cyclical pattern here for the Bitcoin supply and profit loss. The bottom occurs after they cross. When it comes up here, that’s generally the time where you want to scale out when we’re continuing to push those new all-time highs so to me this is an indicator that would suggest that if we did get another leg down there’s a lot of evidence that could be the major bottom.
This is one of the indicators that we could look towards.”
At time of writing, Bitcoin is changing hands for $21,673, up about 10% in the last seven days.
I
Don't Miss a Beat – Subscribe to get email alerts delivered directly to your inboxFeatured Image: Shutterstock/Joy Chakma/Gorev Evgenii