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Bitcoin on the brink of the abyss - far from the hoped-for $70,000!

Tue 14 May 2024 ▪ 3 min of reading ▪ by Mikaia A.

All lights are red for Bitcoin, which seems once again on the verge of falling. Besides the movements of large whales, often harbingers of declines, crypto exchanges seem to lack enthusiasm on the buyer’s side. Indicators like the Sharpe ratio do not bode well for a potential recovery in BTC prices.

Main enfonçant une pièce de bitcoin dans la boue

Abandoned by Major Players: Bitcoin in Danger

Yesterday, May 13, the crypto community held its breath as Bitcoin showed signs of rising, reaching 63,417 dollars around 7 PM (Paris). A relapse to 56,000 dollars earlier this month had spread panic among traders.

A recent analysis by AMBCrypto reveals a worrying trend in the bitcoin market. According to CryptoQuant, the index was -0.050, indicating that many American bitcoin holders are selling rather than accumulating.

Signal Quant, an expert in portfolio profiling and author at CryptoQuant, commented on this trend, stating that the bitcoin price could undergo another correction before rebounding.

The current trend of Coinbase Premium is currently positive, close to zero. So, if the historical model repeats, we could have better chances of success if we wait a little longer and invest in the rebound after the trend has turned negative.”

Currently, the price of BTC is $62,785, up 2.94% in the last 24 hours. However, this rise might be short-lived.

Bitcoin could therefore experience another decline, as suggested by the Coinbase Premium index signals. This index measures the buying pressure among American investors, a crucial factor given the large number of bitcoin holders in the country.

A high premium value indicates an increase in buying pressure, while a low Coinbase Premium index indicates an increase in sales.

The Risk Season has Arrived

The analysis of the Sharpe ratio offers a worrying insight into Bitcoin’s future. Currently at -2.22, the ratio indicates a risk too high compared to potential profits.

For Bitcoin to rebound, this ratio should reach the zero midpoint. However, the total supply of bitcoins in profits is currently at 87.03%. For a significant rebound, this figure should drop to around 78.20%, the same level as in March, before the previous rebound.

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A decrease in supply could propel BTC above $75,000. Conversely, if the number of coins in circulation increases, Bitcoin could fall further. Currently, daily circulation is 17,600, indicating a decrease in transactions.

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Mikaia A. avatar
Mikaia A.

La révolution blockchain et crypto est en marche ! Et le jour où les impacts se feront ressentir sur l’économie la plus vulnérable de ce Monde, contre toute espérance, je dirai que j’y étais pour quelque chose


The views, thoughts, and opinions expressed in this article belong solely to the author, and should not be taken as investment advice. Do your own research before taking any investment decisions.