A comparative analysis of current and past cycles hints at a continued upward movement for Bitcoin.
- The Puell Multiple needs to rise at least three times more before Bitcoin can hit the top. On-chain data, backed by the MVRV difference, indicated that BTC might surpass $85,000.
Bar the recently concluded week, Bitcoin [BTC] found it hard not to produce a red candlestick in a seven-day timeframe since April. As a result of this, there have been opinions suggesting that the bull run is over.
However, that viewpoint could be invalid considering signals AMBCrypto got from different on-chain metrics. First on the list is Bitcoin’s Puell Multiple.
This metric can give insights into BTC’s valuation by looking at miners’ revenue. Using a 365-day moving average, the Puell Multiple tells if the coin is a cycle top or if there is room for the price to appreciate.
It’s bulls over bears again
Historically, Bitcoin hits the roof of the bull market when the multiple rises past a reading of 3 or more. For example, the metric hit a value of 8.13 before the price of BTC started to plunge.
In 2017, the Puell Multiple reached 6.12 before the bull market was declared void. Fast-forward to 2021, the reading had to hit 3.06 before the capitulation process began.
At press time, the metric, according to Glassnode, was 0.90, indicating that BTC’s price has the potential to move higher.
However, one thing AMBCrypto observed was that the reading dropped from the last one every time the next cycle hit its peak.
Source: Glassnode
Therefore, there is a chance the reading might not surpass 3 before Bitcoin calls it quits. At the same time, this does not imply that the predictions targeting $80,000 and above would not come to pass.
$85,000 is almost a sure bet
Another metric supporting this bias is the Market Value to Realized Value (MVRV) Long/Short Difference.
The idea behind the MVRV Long/Short Difference is to ascertain the value each Bitcoin holder purchased the coin compared to the current price.
If the metric is at 0%, it means that Bitcoin has hit the end of a bear market. On the other hand, Bitcoin hits the end of a bull market when the metric is almost 100% or above it.
From the chart below, Bitcoin’s bear market ended around the 2nd of March 2023. It was around the same period that this bull cycle started.
In 2013, 2017, and 2021, the MVRV Long/Short Difference reached 130%, 87%, and 69% respectively at the top of the cycle. However, the highest the metric has reached this cycle was 41%.
Source: Santiment
With this trend, BTC’s price could likely trade higher than the peak it hit in March. Going by the difference in the metrics of this cycle and 2021, Bitcoin could hit $85,000.
While the coin can also move higher, the $100,000 prediction being mentioned in many corners might be difficult.
If the price hits the landmark, good for holders. If it does not, it might still sound like a good deal for Bitcoin believers.
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