1. Seasonality patterns are constructive.
Bitcoin’s price has moved this cycle in very similar fashion as in 2011 to 2013. If we are to repeat the last quarter 2013, a big increase in price would happen, as most of the price gains came in this period.
2. 100-day cumulative-days-above price indicator (100cmda).
Price is now comfortably above the 100cmda indicator. The chart below shows that price has rallied significantly once it clearly pierces this metric.
Moreover, the 100cmda index, an indicator that measures how much the price of bitcoin deviates from the 100cmda price has just started to increase and crossed its own 200-day moving average.
3. Price expanding average bands.
Price seems to have bottomed at the 4x expanding band metric (black dashed line in the chart below). The next stop could be the 16x expanding exponential average metric, red line, which is at $164k right now (and trending up).
4. Bitcoin’s price 4-year growth.
Even after the increase of the last few weeks, the bitcoin seems cheap relative to its 4-year % growth rate. Right now this metric is at the lowest since 2017, just when the price of bitcoin was about to rally from ~$1k to $20k.
5. Active addresses value model.
Bitcoin’s market cap is very close to its valuation based on the square of daily active addresses, in this case the 365-day moving of this metric (red line in the chart below). This valuation (currently at $1.03T) was a top indicator in Q1 2021. If market cap (currently at $1.02T) managesto go above it, the next stop is $3.08T, the orange line in the chart (365-day MA address², A=3.0).
Keep in mind that the number of daily active addresses are also in an upward trend as we will see in next sections.
6 . Price volatility.
In bitcoin volatility is your friend. I say this because most of price volatility comes when it is trending up, and because a big move usually comes after a period of low volatility.
Well, we entered the 4Q 2021 at low volatility levels, which suggests a big(ger) move is definitely on the cards.
Indeed, current volatility is at similar levels when the price of bitcoin was hovering $20k in late 2020, just before the start of the upward move towards $64K.
7 . Bitcoin’s price 200-day moving average.
Bitcoin price has managed to increase again above its 200-day moving average, a signal that is related with prices trending up for the next few months.
Moreover, the 200-day MA index, an indicator that measures how much the price of bitcoin deviates from its 200-day MA is also increasing and has just crossed its own 200-day moving average.
8. All-time-high (ATH) index.
The number of ATHs in the current cycle has a long way to go compared to previous ones.
Also, the ATH index is currently at 0, when market tops typically arrive as the index reaches 50-70 (the index goes from 0 to 100).
9. Bitcoin holdings growth by whales.
Bitcoin whales have been growing their holdings basically every day since the price bottomed at ~$30k late in July (lightblue dots). Even at current prices of ~$55k they have kept accumulating. The behavior of whale holdings has been very important in signaling tops, bottoms and accumulation zones. Bullish for now.
Additionally, the annual growth in whale holdings seems to have bottomed after a sharp deceleration this year.
10. Active addresses and adoption waves.
The number of daily active addresses on the bitcoin network has been trending up since July 2021. This is bullish because in general, more active addresses, higher bitcoin valuation (as you saw in 5. Active address value model).
This can also be seen in bitcoin adoption waves, which reflect how consistently the network activity is above a certain level of daily active addresses. Since September, adoption waves for 750k, 900k and 1M daily active addresses have trended up again.
11. Bitcoin value transferred.
Value transferred on the bitcoin network (number of bitcoin transferred as % of total supply) is above trend (blue line above black) for the first time since 2018, showing increasing activity on the network. For comparison, 2014 and 2017 market tops occurred after value transferred had been above trend for a while.
12. Price behavior model shows the bull run has only resumed.
The price behavior model shows that the number of bull days has started to increase again and that bull days have a lot of room to increase. Market tops typically have come when this indicator approaches or goes above 0.20 (20% of last 200 days classified as bull days). currently it sits at 0.09.
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Notes
On-chain raw data from Coin Metrics.