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On-Chain Indicator Flashing Cyclical Bottoming Signal for Bitcoin (BTC), Says Crypto Analyst Benjamin Cowen

On-Chain Indicator Flashing Cyclical Bottoming Signal for Bitcoin (BTC), Says Crypto Analyst Benjamin Cowen

A well-regarded crypto analyst says a key on-chain indicator points to a cyclical bottom for Bitcoin (BTC). And the loss metric is showing intermittent signs of an all-time low for the top crypto asset by market cap. The on-chain indicator shows what percentage of BTC coins bring their owners a profit or a loss.

One of Cowen’s favorite on-chain measures is the fraction of the bitcoin supply that is in profit or loss. The cyclical nature of this indicator’s ebb and flow makes it my favorite. The unmistakable ebb and flow between bear markets and bull markets are what I’ll observe.

You may notice that they intersect at some point throughout the bear market, and the [percentage of] bitcoin supply gains and losses intersect in every bear market. 2011 and 2014, 2015, 2018, and 2019— and will start crossing again at the end of 2022.

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Cowen continues using the 30-day moving average to compare Bitcoin’s bid percentage wins and losses; one may see a historical pattern that frequently signals a price bottom. “If you apply the typical [30-day] moving average to Bitcoin’s supply percentage in profit and loss, you’ll see that historically they’ve always been crossed before bottoming out at $16,114 at the time of writing, a drop of more than 3.50% in the last 24 hours,” the author writes.

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