Cryptocurrency

Secret Bitcoin indicator shows soil formation

A Bitcoin is currently as solid as a Rock. In times where fighting all of the traditional Assets with heavy losses, you can keep the Bitcoin price is good. Many already speak of a possible bullish reversal of the trend, and that we have seen the bottom already. This is also the Bitcoin indicator that was used in the past successfully, to set a floor educational talks.

Bitcoin indicator shows possible soil formation

Before few week, Bitcoin was still at $ 10,000. The Coronavirus crisis has, however, made prior to BTC, and a historical price-to-break-up to 3,800 USD caused. Thus, the possible rate increase before the Bitcoin Halving, which will take place in less than 2 months is, for the time being, off the table. Thus, many investors are facing heavy losses, but maybe also a BTC Miner, the get in may of a Block on the other half in Bitcoin for their work.Right here is the Bitcoin indicator, the one we received today is closer to playing a key role. This is the so-called “Puell Multiple”. This is currently decreased to a level that is compared to the historical data is extremely low. In addition, the respective Bitcoin exchange rate floor was in a similar low values achieved. After that, it went uphill in the rule, always. In other words, The indicator shows that Bitcoin is currently undervalued.The Puell Multiple is calculated by the daily new BTC in US Dollar by the moving 365-day average of the daily new BTC in US dollars is divided.New Bitcoin arise due to any newfound Block by a Miner. This is a kind of Motivation for the Miner, in order to feed their power into the System. Currently the Block Reward is 12.5 BTC per Block. After the Bitcoin Halving, there will only be 6.25 BTC per Block. The Miner must sell in a certain part of this BTC directly on the market to cover their running costs.

Bitcoin Puell-Multiple in the area of the reversal of the trend

The Puell Multiple slipped on the 16. March to 0.41 from. This is the lowest level since the 17th century. January 2019. The measure now moves in the green area, or rather say in the range of 0.3 to 0.5. This area has been achieved in the past, always in the last Phase of the bear market. It was always a sign of a time trend.In December 2017, Bitcoin has reached its previous Peak at USD 20,000. The bubble came at this point to burst, and gave us all a very long bear market. The price dropped until December 2018 up to 3,200 USD. At the time of the Puell-Multiple was at 0.30.Find the right one for you tax Tool. In our tax tool comparison for Bitcoin & Co, you can find out which providers are there and where are their Strengths and weaknesses lie. Choose currencies for you the optimal Tool for easy and hassle-free tax return for Bitcoin and Crypto. For comparison go.

Past shows the accuracy of the indicator

The Bitcoin indicator slide during the last stage of the bear market on March 14. November 2018, in the green area. At the time, was broken after several attempts, the $ 6,000 support to the bottom. On this day, the Puell-Multiple fell below 0.5, indicating that an under-valuation. The selling pressure abated in the following days, and allowed a recovery of 3,400 USD 4,400 to USD in the last week of November.The recovery was only of short duration but much more downhill it went with the Bitcoin exchange rate as well. In the middle of December was reached, the current floor with 3,200 USD. Here is the Bitcoin indicator was close to the 0.30.The indicator has already been applied in the past perfect. At the end of 2011, when the first bubble burst around 31 USD, and the Bitcoin marched again in the direction of $ 2, the Puell-Multiple about 0.3. So similar it was a 2015, as the bottom was reached after the bubble in 2013/2014. There, the indicator was at a similar level. Thus, the low number was always a good indicator to determine the end of a bear market.The best and safest stock market choose for you to opt for the right provider is not always easy. Therefore, we recommend that you take a look at our Bitcoin brokers & exchanges to throw a comparison. Trading on the safest and best exchanges in the world! For Comparison

The Bitcoin bear market is now over?

The last measurement of the Bitcoin indicator Puell-Multiple was below 0,50. This suggests that the worst is already behind us. Other indicators such as the Z-value of the market value and the realized value (MVRV) also suggest an under-valuation.BTC does not have to be out of the woods yet. Because in the past the indicator has fallen again to approximately 0,30, before the bear market was over. The us remained until now spared. If it is based on the story, it could lead to a further sales boost that could push the prices probably in the range of 5,000 to 4,000 USD and the Puell-Multiple to 0.30.In addition, we’re currently in a bear market than in the past. The crisis was not triggered by another Bitcoin price bubble, but by a pandemic. Therefore, another possible impact from the Coronavirus in the courses are not foreseeable. However, we can see that the BTC Ecosystem works in a crisis without problems.This market has decoupled from the traditional market is quite strong. The current correlation of Gold and S&P 500 shows. In Bitcoin no trillion from the Central Bank to be pumped clean as in the traditional market. BTC needs no help in a crisis. We also to run, perhaps in a Hyperinflation, and here, one could argue, in fact, as deflationary and limited Asset.

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(Image Source: Shutterstock, Trading View, Coinmetrics)

About the author

Eve Manning

Eve Manning

A native Texan, Eve first started out as a Finance Analyst and later realized that her true passion was not in trading but in writing. She leverages her experience in the Finance industry to analyse and write in-depth news articles covering the Cryptocurrencies, Economy & Finance industries.