Bitcoin’s price may be preparing for parabolic tension parasitic force sets – analysts explain why
The price of Bitcoin has been happy over the past few weeks, bounced from its low of $74,000 and returned to its $100,000 level again. Interestingly, the latest chain data suggests that major cryptocurrencies may be preparing to recover their current all-time highs and may start a new bull.
Bitcoin price follows Gold’s steps
In a QuickTake post on the crypto platform, Chain analyst Ibrahim Cosar puts forward data-centric insights to understand the potential trajectory of Bitcoin’s price in the coming months. The relevant indicator here is the growth rate difference (market value vs. the realized upper limit), which focuses on the difference in growth rate between asset market value and realized capitalization.
According to Cosar, the growth rate difference measure helps assess investors’ behavior (whether the market is too pessimistic or optimistic) and different market cycles. The indicator also helps determine the correlation between real value growth and price growth, while assessing the sustainability of price trends.
Source: CryptoQuant
As shown in the above figure, the positive area (indicated in green) usually indicates bullish market conditions. It shows that market caps are growing faster than the caps achieved, with more investors entering the market and taking new positions.
As more and more investors unload their assets, the negative (red) area is associated with bearish market conditions and major price corrections. As prices fall and losses increase, investors’ confidence in the market begins to decline.
Highlighted charts show that in recent days, Bitcoin prices have just witnessed the transition from red (bear market) to green (bull market). Cosar believes that this change means a potential parabolic rise in BTC prices – as can be seen in gold prices over the past few months.
The bull cycle may still be: Crypto CEO
Two months ago, CryptoQuant founder Ki Young Ju assumed that BTC’s price had peaked and that the bull cycle was over. But the chain analysis expert has gradually returned to their declaration after an impressive performance in recent weeks of Bitcoin’s price.
According to JU, the Bitcoin market has become relatively diversified and seems to be moving away from traditional circular theory. Crypto CEO hints at past whales, miners and new retail investors controlled past cycles, while exchange-traded funds (ETFs) issuers, strategies (MSTs) and institutional investors are the main players in the current one.
However, JU mentioned that the Bitcoin market is still sluggish while absorbing new liquidity, despite the recent price action being extremely optimistic. Therefore, the crypto founders are hinting at a clearer signal before taking a new market position.
As of this writing, the flagship cryptocurrency is worth just over $103,000, reflecting the absence of significant movements in the past 24 hours.
The price of BTC on the daily timeframe | Source: BTCUSDT chart on TradingView
Featured images from Istock, charts for TradingView
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