This article will cover data from 10 different bitcoin indicators, most of which have proven to be valid and have all correctly predicted the last bull market peak.
Below we will compare past and present data to further help us gain insight into how far the market is going at the moment.
Google Search Index
Golden Ratio of 51% and 49%
Two-year MA multiplier indicator
Bitcoin Rainbow Band
Bitcoin Reserve Risk
- Google Search Index
Historically, at the peak of the bubble, the term “bitcoin” was searched by internet users a ridiculous number of times, and searches for the new bull market increased exponentially over the previous bull market.
There are no signs of this in the current cycle, with searches for “bitcoin” not exceeding the peak of the previous bull market.
- S2F model
The S2F model represents the relationship between stock and production. The “stock” is the number of bitcoins mined, and the “production” is the number of bitcoins produced per year, as follows: S2F = Stock / Production
Red arrow: peak of the last bull market, green arrow: sub-peak, white box: where we are now
So here are the questions.
- Can we consider $64,804 as the peak of the current bull market?
The answer is no, for two reasons.
First, unlike the previous trend, this does not look like a steeply growing bubble top, but rather a top with a relatively flat trend.
Second, compared to previous bull markets, the current one is not off the chart and is well below the 463-day average S2F value.
Therefore the peak we hit on April 14, 2021 may not be a top yet.
- Could this be a sub-peak?
As you can see in the chart, the sub-peak in the 2013 wave cycle was significantly higher than the 463-day average S2F value. However, in the current cycle, we have not seen a single significant deviation from the trend.
Instead, this could be a potential “cooling + consolidation” phase. Although not necessarily true, it is hard to believe that this is a sub-peak based on the similarity of the charts and the history of bull markets.
- 51% and 49% golden ratio
The focus of this indicator study is the bull market cycle. The indicator shows that the previous bull markets have one thing in common: the bottom to half phase accounts for 51% of the entire bull cycle, while the rest of the phase (from half to top) accounts for 49%.
In 2013, after bitcoin was halved, the price of the currency performed strongly. It then entered a short-term bear market, followed by new highs. 2017, the period after the halving, saw a parabolic shape in price, peaking after 4 or 5 price corrections in between. Both times were very much in line with the golden ratio of 51% and 49%.
Immediately after the market enters the down-consolidation phase, we go from the 2018 lows, through the 51% phase, through the halving in May 2020, and the market ripples upward all the way to June 2021, yet the chart below shows that there are still a few months to go before the full 49% phase.
From this point on, the bull market is still not over.
- Two-Year MA Multiplier Indicator
The two-year MA multiplier, intended to be used as a long-term investment tool, shows the periods during which buying and selling bitcoin will generate great returns.
This indicator is often used to determine tops and bottoms. Historically, it accurately marked the sub-peak, peak in 2013 and the bull market top in 2018.
Looking at this indicator, the current market does not show any signs of sub-peaks or peaks. Another observation, the current green trendline is very close to the 2013 and 2017 trend.
- Bitcoin Rainbow Band
This is an interesting way to look at long-term price movements, ignoring the “noise” of daily fluctuations. Rainbow bands follow logarithmic regression.
It had predicted that Bitcoin would reach $10,000 on Nov. 22, 2017. The truth was just 5 days later than the prediction.
Now, it predicts that Bitcoin will reach $100,000 on July 16 of this year. This is yet to be confirmed.
Also, this indicator is often used to make decisions about when to sell and accumulate bitcoin. 2013 and 2017 show that the deep red band is often the top of the market as well. And the current bull trend has not yet touched the crimson band.
- NUPL Indicator
NUPL is Net Unrealized Profit/Loss, which determines whether the money in the market is currently in a floating loss or floating profit based on the time of the transaction on the chain, and then calculates the difference between unrealized profit and unrealized loss.
When the NUPL is in the orange zone, the market is in a greedy state, and when the NUPL is in the pink over-excited zone, it indicates that the market is clearly overheated. For investors, this is a period of market pullback and a favorable time to take profits and close.
This cycle we reached the greedy phase of the market, but did not go to the overexcited phase. This suggests that Bitcoin has likely not peaked yet in this cycle.
- Puell Multiple Indicator
This indicator looks at the supply side of the bitcoin economy – bitcoin miners and their income. It looks at the market cycle in terms of mining revenue. Bitcoin miners are sometimes referred to as “forced sellers” because they need to pay the fixed cost of mining hardware in a market with extremely volatile prices. As a result, over time, their income affects the price to some extent.
Puell Multiple is calculated by dividing the daily token issuance ratio by a 365-day moving average of that value. Looking at this chart, we have not yet reached the top and the indicator is still some distance away from the upper limit.
- MVRV Indicator
The MVRV indicator is commonly used to measure whether bitcoin is undervalued or overvalued.
The image shows that the MVRV hits the bitcoin peak with precision – the MVRV peaks in 2013 and 2018 were also the peaks of bitcoin. Currently, the MVRV index is still far from the peak.
- RHODL Ratio
The RHODL indicator identifies the price highs of every previous macrocycle of Bitcoin. It can accurately identify market tops within a few days.
The RHODL indicator entering the red band means that the market is approaching the top of the cycle, which is a good time for investors to take profits in each cycle. Currently, RHODL is still some distance away from the peak.
- Reserve Risk
Reserve risk is an entry/exit recommendation given by measuring risk and reward, and it can be indicative of long-term holders’ confidence in bitcoin at certain points in time.
When confidence is high and price is low (green zone), the rewards of investing in bitcoin are attractive at this time. When confidence is low and price is high (red zone), investing in bitcoin at this time requires a higher level of risk. Currently, the Reserve Risk Index is in the middle of the pack.
All of the above indicators suggest that we may not have hit a true bull market peak yet. If these indicators are reliable, then the next market is the top priority.
Posted by:CoinYuppie，Reprinted with attribution to:https://coinyuppie.com/is-the-bull-market-still-alive-these-10-indicators-will-help-you-determine/
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