Is Bitcoin’s Rally Over? Insights from CryptoQuant Suggest Market Correction
According to analysis from CryptoQuant, Bitcoin may be on the verge of a significant price correction. This prediction is based on the Adjusted Spent Output Profit Ratio (ASOPR), a key metric that indicates the profit ratio of spent outputs. When the ASOPR exceeds 1, it signifies coins being sold at a profit and typically corresponds with a bullish market. However, historical data indicates that when the ASOPR approaches 1.08, a correction phase often follows.
Investors can use this pattern to assess the market’s health and evaluate their positions before potential downturns. Another crucial factor mentioned in the analysis is the 200-day moving average (MA), which provides insight into the long-term market trend. Currently, Bitcoin’s performance below this MA confirms the cautious stance indicated by the ASOPR.
Despite positive developments within the industry, such as Standard Chartered Plc launching a new trading desk for Bitcoin and Ethereum, Bitcoin’s value continues to fall. The Winklevoss twins’ endorsement of Donald Trump’s presidential campaign has also not led to any significant upward movement in Bitcoin’s price. Analysts predict that Bitcoin may remain in the $58,000 to $60,000 range for some time before experiencing a noteworthy price increase later this year.