Quantitative analyst Plan B says that Bitcoin (BTC) is flashing signals that strongly suggest that the leading digital asset by market cap is bottoming out and starting a new market cycle.
The pseudonymous analyst tells his 1.8 million Twitter followers that on-chain data is indicating that more than half of BTC in circulation is now in a state of profit.
Plan B’s chart shows a cycle of BTC going from majority in profit, depicted by red dots, to roughly half in profit, depicted by dark blue dots.
According to the analyst, coins in profit going from 50% to over 60% is a strong bottoming signal.
“More bottom signals: >60% of all Bitcoin is in profit”
Plan B also has his eye on Bitcoin’s long-term relative strength index, one of the most widely used momentum indicators that aims to determine whether an asset is oversold or overbought. Using the indicator on a 14-month scale, Plan B points out that BTC’s RSI is at historic lows, suggesting that Bitcoin is deeply undervalued.
“Bitcoin RSI will not stay low forever!”
Leading crypto analytics firm Glassnode has also reported that on-chain metrics suggest that Bitcoin is forming a bear market floor. In a recent report, the firm said BTC’s accumulation trend score, which shows the aggregated balance change intensity of active investors in the past month, is mirroring the 2018/2019 bottoming process.
Says the analytics firm,
“Throughout the capitulation in early 2022, the accumulation trend score indicates significant accumulation by large entities has taken place, as well as the seizure of the recent bear market rally to $24,500 for exit liquidity. At present, this metric suggests an equilibrium (neutral) structure in the market, which remains similar to early 2019.”
At time of writing, Bitcoin (BTC) is trading at $20,767, flat on the day.Don't Miss a Beat – Subscribe to get crypto email alerts delivered directly to your inbox
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