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Bitcoin (BTC), the largest cryptocurrency by market capitalization, rose to highs of $58,487 in the early Thursday trading session. However, amid this price rise, a prominent crypto analyst has issued a warning, urging caution as the market heats up.
According to Julio Moreno, Head of Research at CryptoQuant, valuation metrics indicate that the price of Bitcoin remains bearish.
Moreno stated that Bitcoin is still in a bear phase and has decoupled from gold as investors switch to risk-off mode.
In its recent analysis, CryptoQuant highlighted that the Bull-Bear Market Cycle Indicator has been in a bear phase since Aug. 27, when the price of Bitcoin was $62,000. A significant rally is unlikely to occur as long as the indicator stays in the bear phase.
Similarly, the MVRV ratio has fallen below its 365-day moving average since Aug. 26. A cross below the 365-day moving average indicates the possibility of a further price correction. This situation was also present in May 2021, when Bitcoin fell 36% over two months, and in November 2021, when the last bear market began.
Tomiwabold OlajideBearish signs are also evident in Bitcoin long-term holders (LTH) spending at lower profit margins. The LTH SOPR ribbons have been drifting lower since late July. The fact that LTHs are spending at lower profit margins demonstrates a lack of new demand for Bitcoin.
Bitcoin briefly hits $58,000
Bitcoin (BTC) surpassed $58,000 in early Thursday trade, driven by a surge in U.S. equities and gains in the Asian share market.
U.S. inflation data for August bolstered bets on a Federal Reserve rate drop in the coming weeks, with core inflation rising faster than expected to more than 0.3%.
At the time of writing, BTC was up 2.18% in the last 24 hours to $58,025. However, spot bitcoin exchange-traded funds (ETFs) in the United States returned to outflows on Wednesday, following a two-day inflow streak, losing $43 million.
Godfrey Benjamin
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