Onchain data service says there are five key indicators that may guide investors to determine if Bitcoin is closing in on a local top.
There are 5 key warning signs when bitcoin is nearing a price peak according to onchain data service. In a Nov 19X post, CryptoQuant shared its top indicators to watch out for when accessing if Bitcoin’s price is nearing an unstable level..
*MVRV Ratio – This is the first signal ‘l”MVRV ratio ” which measures Bitcoins market value ie the sum of all coins that have been mined—against its realized value, the sum of the latest selling price of Bitcoin in circulation. CryptoQuant said if it is over 3.7, it’s a clear signal that Bitcoin has come to its peak valuation for the moment, it’s currently showing a score of 2.67,–from coinglass data. In the past Bitcoins MVRV ratio got up to 7 in February 2021 when Bitcoin rallied to reach a historical peak of about $60,000.
*Fear and Greed Index overheats The next indicator to watch is the Crypto gear and Greed Index, which actually measures market sentiment.
When the index hits 80 out of a total score of 100-combined with other indicators—Bitcoin could be near local top, -“CryptoQuant” The index has been above 80 since Nov. 12. And reached as high as 90 on Nov. 17 and Nov.19–it’s Thursday since F we February of 2021.
*New money inflows This signal observes how much new money is coming into the market– without significant”new money flow,” the price of cryptocurrencies tends to stall and most surely take a pull back. CryptoQuant said Bitcoin’s realized cap growth chart is the ideal tool to monitor how much money is flowing into the market, and it currently shows that new money inflows are quite high, i.e. Bitcoin is in a “pull phrase”
*Coin days Destroyed indicator This indicator assesses long term BTC holders, are actively selling . The coin Days Destroyed tool shows the movement of Bitcoin that has been dormant for long periods and checks if they are being sold. If the indicator spikes above 15-20 million, CryptoQuant says this could be a short bearing signal for the price of Bitcoin.. The indicator currently shows a score of course is 15.1 million
*Inter-Exchange Flow pulseThe final indicator is the inter-Exchange Flow Pulse(IFP), which monitors the movement of Bitcoin to and from derivatives exchanges. CryptoQuant said that the IFP still shows a bullish structure, with traders still moving Bitcoin to derivatives exchanges to be used as collateral .
The price of Bitcoin has continues to top notch new heights since Donald Trump’s Election ,with its latest peak bing on Nov.19th Hitting over $94,000,includingSome analysts think that Bitcoin has plenty of room from all round, in conclusion.
