Yerevan (CoinChapter.com) — As Bitcoin returns to lower levels after establishing a record high near $65,000, speculations about its bullish exhaustion are rising. Now trading around $56,000, the flagship cryptocurrency is losing its market share to rivaling crypto assets, including Ethereum, which rose more than 16 percent on Tuesday.
Nevertheless, one on-chain indicator has projected BTC in a bullish light, ignoring its recent correction. Dubbed as Bitcoin Reserve Risk, the indicator states that BTC/USD has more fuel to continue its upside price rally, perhaps towards a $100,000-valuation.
Reserve Risk Indicator
Reserve Risk is a cyclical indicator. It tracks risk-reward balance relative to the confidence and conviction of long-term holders. When confidence is high, and the price is low, the risk/reward comes for investment. An opposite case with the high price and low confidence indicates an opposite attraction, and buying is not recommended at this point.
Calculations are made using parameters such as Bitcoin Days Destroyed (BDD). Example: Josh buys 1 BTC and keeps it in his wallet for 10 days. Afterward, he sells the token, which would then ‘destroy’ 10 BTC Days as it moves from Josh’s wallet to a different one (10 BDD). It is notable that merely transferring BTCs from one wallet to another does not destroy the tokens. It merely represents their lifecycle in a wallet.
As the graph above suggests, every time the Reserve Risk hits the red zone, it increases the selling pressure in the bitcoin spot market. Conversely, a greened Reserve Risk reading indicates a bullish bias.
“Reserve Risk via Glassnode looks like we’re still in the middle of this bull cycle with BTC at $58k. Over 0.02 is when it looks more ‘toppy’ or potential end of the cycle,”
noted Stephan Livera.
Bitcoin’s Reserve Risk. Source: [BTCUSD] on Glassnode.com
Livera suggests that this is not the first time for bitcoin to be in such a position, expecting the price to recover and go bullish.
Bitcoin Price Now
The bitcoin price climbed Monday, going as high as $58,812 around 13:00 UTC (8 a.m. ET), which is still over $6,000 off from its record high being $64,829, set on April 14.
Bitcoin prices stay on downside correction course. Source: [BTCUSD] on Tradingview.com
Also, besides Reserve Risk, many other indicators are predicting price increase too. Relative Strength Index (RSI), Moving Average Convergence Divergence (MACD) and simple Wave Count all suggest that BTC continues its way to bullish.
My name is Edgar Meliksetyan. I live in Yerevan, Armenia. After finishing middle and high school, I have got accepted into the American University of Armenia in the academic program of Business and Economics, and here I presently study. I am a crypto trader, stock trader and statistician for an applied nowadays problems.
According to Bank of America, cash holdings among investors have increased, causing bearish risks for Bitcoin (BTC) & the...
Our Partners
We use cookies on our website to give you the most relevant experience by remembering your preferences and repeat visits. By clicking “Accept”, you consent to the use of ALL the cookies.
This website uses cookies to improve your experience while you navigate through the website. Out of these, the cookies that are categorized as necessary are stored on your browser as they are essential for the working of basic functionalities of the website. We also use third-party cookies that help us analyze and understand how you use this website. These cookies will be stored in your browser only with your consent. You also have the option to opt-out of these cookies. But opting out of some of these cookies may affect your browsing experience.
Necessary cookies are absolutely essential for the website to function properly. These cookies ensure basic functionalities and security features of the website, anonymously.
Cookie
Duration
Description
cookielawinfo-checbox-analytics
11 months
This cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Analytics".
cookielawinfo-checbox-functional
11 months
The cookie is set by GDPR cookie consent to record the user consent for the cookies in the category "Functional".
cookielawinfo-checbox-others
11 months
This cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Other.
cookielawinfo-checkbox-necessary
11 months
This cookie is set by GDPR Cookie Consent plugin. The cookies is used to store the user consent for the cookies in the category "Necessary".
cookielawinfo-checkbox-performance
11 months
This cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Performance".
viewed_cookie_policy
11 months
The cookie is set by the GDPR Cookie Consent plugin and is used to store whether or not user has consented to the use of cookies. It does not store any personal data.
Functional cookies help to perform certain functionalities like sharing the content of the website on social media platforms, collect feedbacks, and other third-party features.
Performance cookies are used to understand and analyze the key performance indexes of the website which helps in delivering a better user experience for the visitors.
Analytical cookies are used to understand how visitors interact with the website. These cookies help provide information on metrics the number of visitors, bounce rate, traffic source, etc.
Advertisement cookies are used to provide visitors with relevant ads and marketing campaigns. These cookies track visitors across websites and collect information to provide customized ads.
