Bitcoin (Bitcoin) The price reaction on August 7 was as high as $44,600, because people speculated that it might experience an upsurge similar to the one that started in October 2020.
At least two indicators predict that Bitcoin will pursue a sharp upward trend. The first is Glassnode’s Entry-Adjusted Net Unrealized Profit/Loss, which can help investors determine whether the entire Bitcoin network is currently in profit or loss.
Understanding NUPL and its heat map
A NUPL reading above zero indicates that the network is in a state of net profit, while a value below zero indicates a state of net loss. The farther NUPL is from zero, the more it can help investors discover the tops and bottoms of the market.
They found the degree of deviation from zero through the heat map. For example, in an upward trend, red means “surrender”, orange means “hope”, yellow means “optimism”, green means “belief”, and blue underline means “euphoria”.
In October 2020, Bitcoin NUPL moved upward to zero because its heat map changed from yellow to green after successfully rebounding from the red area in early March of that year.
Later, the price rose from approximately US$10,000 to approximately US$65,000.
Bitcoin later fell below $30,000, during which time its NUPL sentiment changed from greed to denial, and later to anxiety. However, the strong buying sentiment of close to $30,000 helped to maintain Bitcoin’s upward sentiment intact, offsetting anxiety with optimism.
But as Bitcoin recovers $40,000 After surpassing its upward momentum, market sentiment has returned to confidence for the first time since October 2020. Lex Moskovski, Chief Investment Officer of Moskovski Capital, also emphasized the upward prospects of Bitcoin after the NUPL upgrade in his tweet. He said:
“We have entered the belief phase.”
Or, the popular fear and greed index also touched 69, which indicates that greed has never been seen in the market since May.
The second indicator
Similarly, market analyst Will Clemente also highlight Another pledge will repeat the indicators of upward prosperity in October 2020. Fractals involve the dynamics between short-term and long-term Bitcoin holders.
Clement pointed out that short-term holders sold their Bitcoin holdings For long-term holders, So that the Bitcoin supply accumulated by the former in August 2021 is almost as much as the Bitcoin supply in October 2020.
related: The price of Ethereum soared above $3,000 and entered the “red zone”, causing selling concerns
The analyst wrote: “Long-term holders now have more than 66% of the supply, and short-term holders have now fallen to nearly 20%.” “The supply of long-term holders was just before the start of the major bull market in October. More than 68%.”
This further shows that the latest price is based on the demand of investors who have no intention of selling Bitcoin.
Bitcoin hit an intraday high of $44,600 on Saturday, and then fell back due to profit-taking sentiment. At the time of writing, BTC changed hands for $43,500.
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