Analyst Game of Trades stated that, based on 6 different on-chain data, the Bitcoin price is in a unique position to invest in the long-term.
Analyst focused on Bitcoin
Bitcoin often sets the pace for other cryptocurrencies to follow. Analysts often focus on Bitcoin to identify or predict market trends.
Bitcoin: 6 on-chain metrics calling for a generational long-term buying opportunity
A thread 🧵
— Game of Trades (@GameofTrades_) January 23, 2023
Recent analysis by pseudonymous analyst Game of Trades has revealed six on-chain metrics that show levels that have occurred in the lower three bear markets in the past. Analyst Game of Trades says on-chain data points to BTC Investment as a “buying opportunity.”
The analyst shared his findings on Twitter, discussing current accumulation, reserve risk, resting ground, and other positive key indicators for Bitcoin.
Analyst’s metric analysis for Bitcoin
Accumulation trend score
According to Game of Trades, these on-chain metrics show significant backlog among investors. This metric shows a combination of the size of assets relative to the number of new coins users add/sell.
Comparing this trend with the past, the analyst pointed out that the same thing happened in 2018 and 2020, when BTC bottomed out. The analyst said in his statements:
“Rest flow has slumped to its lowest level indicating speculative hands are washed and only strong holders aka Hodlers remain.”
Entity-adjusted dormancy flow
This chain metric measures the ratio of current market value and annual rest value. When the rest value is higher than the market value, the analyst treats the market in total delivery.
Historically, this point marks a buying zone, and GlassNode announced last year that it dropped to a low in 2022.
Bitcoin reserve risk
The analyst stated that the Bitcoin reserve risk parameter, which is used to assess the confidence of long-term holders relative to the BTC price, is giving more positive signals than ever before. Bitcoin reserve risks measure the level of confidence of long-term BTC holders relative to the price.
GlassNode data shows it fell to its lowest level last year, showing high conviction from BTC holders for future price appreciation.
Realized Bitcoin price
Realized Bitcoin price (RP) is a chain metric that shows the value of coins in circulation at their final price. Simply put, it shows the estimation of what the entire crypto market is paying for the BTC supply. But based on the Woo listings, BTC had fallen below the RP level since November 2022, when FTX crashed by Jan 13.
According to the analyst, BTC is above the currently occurring price level, indicating the potential for another buying opportunity.
Bitcoin MVRV-Z score
The MVRV-Z score, which shows when this metric is significantly over or undervalued compared to Bitcoin’s “fair value” or realized price, represents another of the key buy signals, according to the analyst. According to Game of Trades, when the MVRV-Z score moves away from the high-value zone, it indicates the end of a bear market.
This metric examines how it will affect mining profitability and market cycles. According to the analyst, Bitcoin PM is currently lower, indicating a potential for long-term buying opportunities.
The analyst compared the six metrics above that marked a bottom in 2015, 2018 and 2022. As noted, these metrics are at similar levels. Based on these findings, Game of Trades concludes that investors should expect an unusual risk reward setup in reverse in BTC. As we stated as Kriptokoin.com, BTC is instantly traded at $ 22,970.
Bitcoin miners profit status
The lower the value in the metric, the more miner stress there is. In other words, this data, which shows that the miners who turn the industry into a casino with unhealthy and high leverage ratios, are about to be deleted from the market, means a buy signal, according to the analyst.
Game of Trades said that the chart has come out of “the most stressful area” and that the miners that have likely damaged the industry either went bankrupt or largely elephantched at this point. He stated that with this latest data, the market has reached its highest pain value, completed its liquidity quest and is at the beginning of its return path. In addition, the analyst has described Bitcoin as a “buying opportunity for a generation”.
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