What is the general sentiment for Crypto?

The sentiment towards the cryptocurrency market continues to remain in the Fear zone. Compared to last week’s, the Fear & Greed Index has changed marginally from “27” to “25”. 

 

SOPR

Another data to evaluate the sentiment of the general public would be to look at Spent Output Profit Ratio (SOPR). What is SOPR? In layman terms, it indicates if people have sold their BTC at a profit or if they sold at a loss. An SOPR value above 1 indicates that profit booking dominated loss booking and below 1 indicates that loss booking dominated profit booking. A value of 1 indicates that the coins were sold at their purchase price. Adjusted SOPR filters out transactions that are younger than 1 hour, thus, clearing out noise from the metric.

aSOPR for this week stands at 0.98 which means the coins were sold at their purchase price

 

Is This The End of the Bear Market?

 

CVDD-TERMINAL PRICE CHART INDICATOR

TERMINAL PRICE – This is an on-chain indicator. That means it uses data from the Bitcoin blockchain to identify actual user behavior and activity.

Before Terminal price is calculated, it is first necessary to calculate Transferred Price. Transferred price takes the sum of Coin Days Destroyed and divides it by the existing supply of bitcoin and the time it has been in circulation. The value of Transferred Price is then multiplied by 21.

This Terminal Price has historically been very effective at forecasting the tops of Bitcoin price cycles. Currently the TERMINAL PRICE stands at $112,422

CVDD –  tracks the cumulative sum of this value-time destruction as coins move from old hands into new hands as a ratio of the market age. It is then multiplied by 6 million, which is a somewhat arbitrary number as it is not linked to any relevant Bitcoin data.

The result is that it has historically correctly forecasted the major lows of Bitcoins price with good accuracy. Currently the Bitcoin CVDD stands at $17,180 which is the long term support levels, Bitcoin Price is expected to bounce back from here

 

REALIZED PRICE

Realized price is defined as the average cost of acquisition based on every coin moved on-chain. In all the previous bear markets we see that the price trades below the realized price which indicates on average the coins held during this period have higher cost of acquisition than the current market price. Realized prices act as psychological support areas during bear markets.

How Is Realized Price Useful For Bitcoin Investors?

It is a useful metric because it can show when the market is under a period of distress. That is when the current Market Price drops below Realized Price, meaning that on aggregate Bitcoin holders are holding onto paper losses. 

Historically, these periods have occurred at major cycle lows. This can be seen on the free Bitcoin live chart above.

The reason why this phenomenon happens is that many participants are not comfortable holding onto a losing position, fearing that their losses may increase. Particularly in a bear market when news and media about Bitcoin are very negative. They end up selling to value investors at the market cycle lows before $BTC Market Price eventually moves back up above Realized Price as it enters a bull market phase. This has historically held true as Bitcoin has continued to move through its adoption cycle.

The current price of Bitcoin is trading below the realized price of Bitcoin of 19,771 USD. For bull market confirmation, the market price of Bitcoin should be above realized price. 

 

RHODL RATIO

RHODL Ratio is useful for identifying when Bitcoin price is running at the extremes of market conditions. It is able to forecast where Bitcoin price ($BTC) may need to pull back when the RHODL Ratio line approaches the upper red band, and also when $BTC price may rally after spending time in the lower green band. 

 

Overall Market Performance

 

Dow Jones

The Dow Jones Industrial Average gained by 1.46% in the last week. The next resistance is expected at 35,400 and immediate support is expected at 32,650 levels.

 

Gold

Gold Futures formed Inverted head and shoulder pattern, upside movement is expected. The next resistance is expected at $1,883 and immediate support is expected at $1,815

 

Bitcoin

Bitcoin has broken the descending trendline, upside movement is expected for the week. The next resistance is expected at $18,388 and support at $16,450

 

ETHEREUM

ETH/BTC broke out of the 3 month triangle pattern consolidation, upside movement is expected this week. An immediate support is expected at 0.071 and the next resistance is expected at 0.080 levels.