BlocksInform
Bitcoin usually defines the rhythm for other cryptocurrencies to track. Analysts usually focus on Bitcoin to identify or predict market trends.
The latest analysis of the set of trade nickname analysts has revealed six chain measures showing the same levels as in the past three bear markets. The Game of Trades analyst says that data on the chain points to BTC investment as a "generational purchasing opportunity."
Analyst reveal six significant measures for Bitcoin.
The alias analyst shared her findings on Twitter, discussing current accumulation, reserve risk, dormancy threshold and other positive key indicators for bitcoin.
Bitcoin: 6 chain measures calling for an opportunity for long-term generational buying.
A thread ??
— Game of Trades (@GameofTrades_) January 23, 2023
Accumulation Trend Score
According to Game of Trades, these on-chain metrics show that there has been a significant accumulation among investors. First, the investors accumulating BTC are large entities and have been buying heavily since the crash of FTX.
Comparing this trend with the past, the analyst noted that the same occurred in 2018 and 2020 when the BTC reached its lowest level. The analyst said:
Dormancy flow came down to its lowest level EVER seen Indicating that the speculative hands have been washed out And only the strong holders aka HODLers are remaining
Bitcoin Entity-Adjustment Dormancy Flow
This on-chain metric measures the ratio of the present market cap and the annualized dormancy value.
When the dormancy value is higher than the market cap, the analyst considers the market in total capitulation. Historically, this point points to a buying zone, and glassnode has shown that it dropped to last year's low of 2022.
Bitcoin Contingency Risk.
It is the third chain measure that supports the analysis of the game of trades. The risks of bitcoin reserve measure the level of confidence of holders of BTC in the long term with respect to its price. Glassnode data also shows that it fell to the lowest level last year ending indicating high conviction from BTC holders about future price appreciation.
Bitcoin’s Realized Price (RP)
Bitcoin RP is an on-chain metric showing the value of circulating coins at their last price. In simple terms, it shows the estimation of what the whole crypto market paid for the BTC offer. But based on Woo Charts, BTC had fallen below the RP level since November 2022, when FTX collapsed until January 13.
According to the analyst, Bitcoin is now higher than its realized price level, suggesting the potential for another purchasing opportunity.
Bitcoin MVRV Z-Scorecard.
This measure indicates when bitcoin is over or under-valued in relation to its realized price or fair value. According to Game of Trades, when the MVRV Z-score moves away from the highly undervalued zone, it indicates a bear market end.
This measure looks at the economics of mining and the impact it would have on market cycles. Depending on the business play, bitcoin pm is currently lower, indicating a potential for long-term purchasing opportunities.
The analyst compared the aforementioned six measures, which peaked in 2015, 2018 and 2022. As noted, they are at similar levels. In light of this, Game of Trades concludes that investors should expect an unusual risk-reward pattern in BTC to rise.
