August 21 Commodity Market Update

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Bitget2024/08/21 06:50

By:Bitget

2 key Bitcoin metrics signal steady bull cycle — ‘No bubble’ in sight

Although Bitcoin’s price is yet to reclaim its March all-time high, an analyst claims that the bull market remains strong and steady with no signs of a deep correction, based on two key metrics.

In an Aug. 18 report, CryptoQuant researcher Axel Adler looked to two key metrics — the Bubble vs. Crush Market Structure and the MVRV Z-score — as signals that Bitcoin’s current price action is tracking a healthy path forward. “We can see that the current bull cycle is developing quite steadily without significant anomalies or sharp jumps,” Adler added.

Adler highlighted that the Bubble vs. Crush Market Structure has dropped to a score of 1.02, which he considers “the baseline,” suggesting that Bitcoin is not currently experiencing a bubble. Bubbles form in the market when Bitcoin’s market capitalization “grows faster” than its realized capitalization. When Bitcoin hit its all-time high of $73,679, the indicator was signaling a bubble, with a score of around 1.5. Less than a week later, the price plummeted 16% to $61,930, according to CoinMarketCap data.

Adler also noted that Bitcoin’s 30-day Moving Average (DMA) MVRV Z-Score is at 1.8, slightly over BTC’s annual average of 1.6, which suggests “minimal overvaluation.” When the 30DMA MVRV Z-Score surges, it can be an indicator to traders that the asset is overvalued and a price correction may be coming. In March 2021, Bitcoin’s 30DMA MVRV Z-Score reached above 5, just before Bitcoin reached a high of $60,701, just three months later the asset declined 45% to $32,827 by July.

Both Bubble vs. Crush and the MVRV-Z score are metrics used to gauge whether or not Bitcoin could be considered “overvalued.” “As long as the metric does not reach extreme levels that could signal a significant risk of correction, the market can be considered bullish,” Adler added. Several traders have been commenting on Bitcoin’s extended consolidation in recent times.

Source: CoinTelegraph

Futures Market Updates

Bitcoin continued its sideways actions.

Bitcoin Futures Updates

Total BTC Open Interest: $30.71B (-2.51%)

BTC Volume (24H): $54.88B (-0.52%)

BTC Liquidations (24H): $22.57M (Long)/$7.59M (Short)

Long/Short Ratio: 49.25%/50.75%

Funding Rate: -0.0011%

Ether Futures Updates

Total ETH Open Interest: $10.81B (-0.88%)

ETH Volume (24H): $19.73B (-8.48%)

ETH Liquidations (24H): $31.99M (Long)/$2.54M (Short)

Long/Short Ratio: 48.91%/51.10%

Funding Rate: -0.0006%

Top 3 OI Surges

ALPACA: $1.82M (+353.42%)

SUN: $6.39M (+210.65%)

SUNDOG: $318.51K (+200.05%)

Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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