The co-founders of market intelligence firm Glassnode say that Bitcoin (BTC) is suddenly looking less bearish based on a key metric.
In a new thread on the social media platform X, Jan Happel and Yann Alleman – who go by the handle Negentropic – say that Bitcoin’s Risk Signal is flashing bullishness.
The Bitcoin Risk Signal, based on a “set of proprietary indicators, including Bitcoin price data, on-chain data and a selection of other trading metrics,” gauges whether BTC is at risk of a major drawdown in price.
However, the two analysts say that before a bullish trend reversal is confirmed, Bitcoin needs to flip $100,000 into support.
“Good news and bad news – which one do you want first?
Good: the Risk Index has dropped below 25, meaning bearish pressure has significantly eased.
Bad (or maybe not so bad): the BTC futures-to-spot ratio shows a higher increase in futures than spot, indicating this recovery is futures-driven. Meanwhile, shorts are piling up above $99,000-$100,000, which could fuel a squeeze.
With BTC reclaiming $97,200-$98,500, holding this level is key – but until $100,000 is broken, we can’t confirm a trend reversal.”
The analysts also say that Bitcoin needs spot trading volume to increase to hold higher price levels as support.
“Each rebound is weaker, signaling a lack of spot volume for a stronger move…
Until $97,000-$98,500 is recovered, $92,000 remains the key downside level to watch.”
Bitcoin is trading for $98,336 at time of writing, flat on the day.
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