- Bitcoin’s Puell Multiple fell below 0.4, signaling a market bottom and a drop in selling pressure from miners
- A golden cross on the 2-month chart and tighter Bollinger Bands indicated a possible breakout
Bitcoin [BTC]at the time of writing, there were flashing signs of it potential bullish momentum, with the Puell Multiple falling below 0.4. This coincided with the formation of a golden cross on the 2-month chart. These indicators, along with on-chain data, suggested that Bitcoin may be preparing for a significant price move. A closer look at the data is important to assess whether Bitcoin is truly poised for a rally.
For example, the Puell Multiple fell below 0.4, indicating that Bitcoin miners are earning much less than their historical average. This was it noted by analyst Ali Martinez on X (formerly Twitter). This metric has historically been associated with market bottoms, indicating that Bitcoin could be undervalued.
If miners earn less, they are less likely to sell. This reduces selling pressure on the market and often precedes a price recovery.
Source:
How do miners and on-chain activities support the bullish case?
Despite low miner revenue, Bitcoin network activity remains strong. Active addresses increased by 0.93% over the past 24 hours, reaching a total of 8.24k – a sign of greater network engagement.
This rising activity, combined with the fact that miners are likely holding rather than selling, sets the stage for supply constraints that could push the price higher.
Source: Cryptoquant
Miners who hold on to their coins as activity increases on the chain often reduce supply. This could lead to a potential price increase if demand remains stable or grows.
Golden Cross and other technical indicators
On the two-month chart, Bitcoin formed a Golden Cross, a cross with the 50-period moving average above the 200-period moving average. This pattern is a widely recognized bullish signal, especially over longer time frames. This means that Bitcoin may be entering a sustained uptrend on the charts.
Source: TradingView
Furthermore, the Relative Strength Index (RSI) at 51.05 indicated neutral market conditions, leaving room for upside movement.
The Bollinger Bands also appeared to tighten, with Bitcoin near the lower band at $57,758.15. This could mean that the asset is oversold and could see an upturn soon.
Source: TradingView
Is Bitcoin Ready for a Breakout?
With the Puell Multiple signaling a market bottom, the formation of a Golden Cross, and key technical indicators such as the RSI and Bollinger Bands supporting a bullish scenario, Bitcoin may be primed for a potential breakout.
Reduced selling pressure from miners, rising activity in the chain and strong technical signals also supported this hypothesis.