Last few weeks, bitcoin has been leading the pack with extremely bullish price action. But we still had our concerns about whether this was just a dead cat bounce. Now that case is slowly fading. With bitcoin breaking through several high resistance levels, we can now confirm $50k is the new macro lower high for bitcoin. In a matter of a couple of weeks, the market cap increased by almost 300 billion, and the daily average trading volume sits at 42 billion.
We need to check some on-chain metrics to understand what underlying conditions drove up this price and supported a bullish disbelief rally. The main things we are looking for are long-term holder’s accumulation power, mining activity, realized/unrealized profit, and loss, and exchange flows. Let’s dive in.
Long-Term Holder Supply
The long-term holders are not slowing down. The number of entities aggressively accumulating shows great supply distribution in the market. Although we have seen a slight resemblance from 2013/2017 bull runs, this particular move in long-term holder supply is absolutely fascinating. The reason lies in its rate of increase in entities.
Mining Market
When China banned mining activities, we saw the miners initiate one of the biggest sell-offs in bitcoin’s history. So we need to analyze how the mining market is performing. As we can see using the miner profitability chart, the hash rate is coming back online, and the price of bitcoin is helping miners to manage their operational costs. When in profits, there is not much sell pressure. That is why we see miners’ profitability increase every week. It would be exciting to watch what happens when we get back all the hash power online that was once shut down in China.
To extend this further, we have also taken a look at hash-ribbons formed using 30D and 60D moving averages. As 30D crossing above 60D indicates a positive crossover, we are seeing miners add more BTC and earn more per hash.
Realized Cap
This is one of the most important metrics in all of on-chain, for the simple fact that it helps us deduce multiple dynamics of the market activities. The realized cap is similar to the market cap, but it varies when calculating the value of each coin. Realized cap considers the last price a coin was spent and then only calculates the aggregate cost.
In the case of current price action, we see uptrends in terms of accumulation and absorption of sell pressure. We also recently touched a new all-time high of $397 billion. To absorb the selling pressure, we may still need to move above $55k-$57k, but we are currently looking strong with more entities realizing profits.
Stablecoin Supply Ratio
If you want to take away one metric from this article, it should be this one. The stable coin supply ratio compares the stablecoin market and bitcoin’s market cap. When we apply the Bollinger bands to the same metric, we can point out an interesting pattern. Look at the lower band and SSR. Whenever the ratio dips, we see the price go parabolic. It means that stablecoins are flowing back into the market.
To take things further, we can look at Will Clemente’s new metric called the stable coin exchange receive ratio. He took the supply ratio and multiplied it with the total supply to determine how much it is sitting on the sidelines. It is roughly $20 Billion. This indicates bullish price action in the coming weeks, as FOMO still hasn’t even kicked in yet.
To finish off, let us look at our favorite adjusted SOPR. The spent output profit ratio is a great sign of market trading in a state of profit. It recently bounced off the 1 threshold and is now stabilizing around that support. We would love to see this continue in the coming weeks.
We can look at many more metrics using on-chain tools, but the above mentioned are the ones that show strong evidence for the current market conditions to be a bullish disbelief rally. Today’s analysis shows a very bullish structure for bitcoin and also- as we are closing above $47k, and we will see it reach a new all-time high sooner than later.
In conclusion, bitcoin is looking really strong right now, with every on-chain metric showing great support. As we are seeing peak accumulation from long-term investors, bitcoin marks its bottom. If everything goes well in the next couple of weeks, we could see bitcoin making even bigger moves. In a bigger time frame, we could be seeing the price of BTC anywhere between 70-80k by the end of the year (conservative target). Before that, we need to closely monitor what happens when we cross $50k, as we are still not in the greed zone.

Born and brought up in India, Karthikeya Gutta is a crypto journalist and freelance contributor for ItsBlockchain. He covers various aspects of the industry with in-depth analysis and research. His passion towards blockchain and crypto ecosystem is mainly because he believes it can really change the world and help millions of people.
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