The co-founders of Glassnode have commented that Bitcoin (BTC) is replicating the prelude to its 2020 breakout to a “crazy” level.
On June 15, Yann Allemann and Jan Happel tweeted about three BTC price metrics which were far from bearish.
Metrics echo Bitcoin’s “major reversals and rallies”
The price of BTC/USD hit a local peak of $31,000 in April, but has since dropped by approximately 20%. This has had a negative effect on sentiment, with bearish forecasts becoming commonplace in the intervening period.
Despite recent events causing a strain on the market, Allemann and Happel have found three reasons to remain optimistic.
Several on-chain indicators, it was observed, now appear strikingly similar to their state in Q3 2020, shortly before BTC/USD surpassed its old 2017 record of $20,000.
“The similarity to Sep 04, 2020, is remarkable…,” they commented.
Heading the selection is the well-known Relative Strength Index (RSI), which evaluates the extent to which BTC/USD is overbought or oversold at a specified price.
The Daily Relative Strength Index (RSI) is currently at its lowest level since early March, with data from Cointelegraph Markets Pro and TradingView confirming a reading of 35. This was just before Bitcoin’s most recent surge that eventually led to its peak of $31,000 a month later.
The post elucidated that the RSI had reached levels that had previously resulted in significant reversals and rallies.
Allemann and Happel highlighted the Cipher B readings for Bitcoin, which are generated from a set of algorithms that provide indications of when to purchase dips during bull markets, among other things.
“The cipher b wave trends have reached the same levels that caused previous major reversals and rallies,” they reiterated.
The Bitcoin Risk Signal, aptly named, has returned to its September 4, 2020 level. This signal forecasts the possibility of a major decrease in the BTC price, which had risen to a “high risk” level at that point before dropping again.
The following months saw a flat Risk Signal reading while BTC/USD continued to rise.
Hodlers big and small increase BTC exposure
Elsewhere, signs were seen by Glassnode that showed investors were maintaining their confidence in the long term.
A Bitcoin analyst suggests that the Federal Reserve will be beneficial to bulls, advising to “pick your targets”.
For Checkmate, the lead on-chain analyst, there has been an impressive accumulation of existing hodlers.
He tweeted about the pessimistic sentiment on June 15, saying it was “pretty doomy out there.”
Accompanied by charts, the “Absorption Rates” of various holder cohorts according to wallet size were displayed.
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