Another Bitcoin Metric Turns Bullish With Price At $23,000 And Forecasts More Profits

Bitcoin has been moving sideways during this week as bullish momentum fades under the pressure of macroeconomic uncertainty. The cryptocurrency has been recording significant profits since the beginning of 2023, flipping market sentiment from fear to optimism as it reconquers previously lost ground. Related Reading: AI Token The Graph (GRT) Sees Correction, But How High Can The Price Go? As of this writing, Bitcoin (BTC) trades at $23,000 with sideways movement across the board. Other cryptocurr[...]

Bitcoin has been moving sideways during this week as bullish momentum fades under the pressure of macroeconomic uncertainty. The cryptocurrency has been recording significant profits since the beginning of 2023, flipping market sentiment from fear to optimism as it reconquers previously lost ground.

As of this writing, Bitcoin (BTC) trades at $23,000 with sideways movement across the board. Other cryptocurrencies in the top 10 by market cap are seeing better performance, with Polygon (MATIC), Ethereum (ETH), and Cardano (ADA) still trading in the green over the same period.

Bitcoin Long-Term Fundamentals Hint At Further Profits

As Bitcoin pierced through the critical resistance at $24,000, fundamental metrics point towards extending the current bullish trend. According to a report from Bitfinex Alpha, the Realized Profit/Loss Ratio (RPLR) for BTC turned bullish for the first time since April 2022.

The RPLR is used to gauge the buyer/seller dynamics. At its current levels, the indicator points to two critical facts: Bitcoin investors are taking profits, and there is enough buying pressure in the crypto market to counter sellers. The report noted:

“this generally signifies that sellers with unrealized losses have been exhausted, and a healthier inflow of demand exists to absorb profit taking”. Hence, this indicator is sending a bullish sign for a longer timeframe investor.

As seen in the chart below, a spike in this metric above zero has preceded periods of extended appreciation, such as the February to March and the August to November bull runs from 2021. At that time, Bitcoin recovered from a significant crash before it resumed its bullish momentum and re-entered price discovery.

Bottom In, Bears On Their Way Out

As the report noted, this is not the first time Bitcoin has bottomed following a spike in its RPLR. In 2019, when the metric hit 0.2, the cryptocurrency crashed to a multi-year low of $3,600, then moved to a long consolidation period before rallying to a new all-time high.

The report claims that the BTC’s price could see similar price action throughout 2023, with long consolidation followed by more rallies. These bull runs often see Bitcoin trading 20x or 10x from its low. Bitfinex noted:

The RPLR again recently bottomed around 0.18, its lowest since 2011, and Bitcoin was trading in the $16,000s in November 2022. Bulls will be hoping for history to once again rhyme, and that the world’s largest cryptocurrency by market cap can post another exponential rally from lows over the next three or so years. A 10x rally from recent lows would see Bitcoin hitting around $160,000.

Source: NewsBTC