Real Vision analyst Jamie Coutts says the stage is being set for a crypto bull market as several indicators turn bullish.
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“Over the past seven months, Bitcoin consolidation has significantly cooled valuation metrics that had overheated in the first quarter.
With the exception of open interest at an all-time high (100th percentile), almost every metric – from MVRV (market value to realized value) and Puell to LTH SOPR (long-term holder spent profit rate) and the network value at the addresses. – reset below the 50th percentile.
Much of the sell-off was driven by excessive leverage in the derivatives market, primarily on the long side, and this excess was eventually resolved.
In September, we saw a classic reload signal, with the Puell Multiple briefly reaching oversold, while network security reached new highs.
Let’s not forget that global liquidity is accelerating upwards.
The stage is set.
The Puell Multiple indicator, MVRV, LTH SOPR, and Network Value to Addresses are all on-chain metrics designed to assess the health of Bitcoin.
At the time of writing, Bitcoin is trading at $69,173.
Beyond Bitcoin, Coutts says Ethereum (ETH) rival Solana (SOL) is leading the smart contract platform (SCP) race and may be preparing to break into its USD and BTC pairs.
“This cycle, SOL led the major L1 (Layer 1) SCPs. Interestingly, factorial stock momentum strategies, such as rolling out a 12-month screen, also tend to perform well in cryptocurrencies despite higher volatility.
The SOL/BTC ratio is the one to watch (bottom). It hasn’t burst yet.
At the time of writing, Solana is trading at $165.
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