Real Vision analyst Jamie Coutts says the stage is being set for a crypto bull market as multiple indicators turn bullish.
On the social media platform X, Coutts say Nearly every metric he uses to gauge the health of the Bitcoin market cycle is no longer in “overheated” territory, which bodes well for BTC.
“Over the past seven months, Bitcoin’s consolidation has significantly cooled valuation metrics that were 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 output profit ratio) and network value to addresses – has reset below the 50th percentile.
Much of the sell-off was driven by overleverage in the derivatives market, especially on the long side, and that overhang is finally gone.
In September we saw a classic top-up signal where the Puell Multiple briefly became oversold, while network security reached new highs.
Let’s not forget that global liquidity is on the rise.
The stage has been set.”
The Puell Multiple indicator, MVRV, LTH SOPR, and Network Value to Addresses are all on-chain metrics designed to measure the health of Bitcoin.
At the time of writing, Bitcoin is trading at $69,173.
In addition to Bitcoin, Coutts says Ethereum (ETH) rival Solana (SOL) is leading the smart contract platform (SCP) race and may be gearing up to break out into its USD and BTC pairs.
“This cycle, SOL has been running the main SCP L1s (layer 1s). Stock momentum factor strategies, such as deploying a 12-month filter, interestingly also work well in crypto, despite the higher volatility.
The SOL/BTC ratio is the one to watch (bottom). Hasn’t broken out yet.”
At the time of writing, Solana is trading at $165.
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Generated image: Midjourney