Bitcoin (BTC) could be entering the end of the correction phase price to enter a bullish rallywhich would arrive in the third quarter of 2024. This is suggested by the analyst known as Crypto Dan, based on the Puell multiple, a metric used to detect good moments to buy or sell the digital currency. As BitcoinDynamic has been reporting, the BTC price is fighting against downward pressure caused by the returns of the extinct Mt. Gox to creditors and the transfers of this digital asset made by the German Government. In this framework, the price of the digital currency created by Satoshi Nakamoto It plummeted during the last week from $62,000 to $54,000.. However, amid this selling pressure, Crypto Dan argues that, based on the data provided by the Puell multiple, There will be a change of trend. He explains:
“It’s a once-in-a-lifetime opportunity during a bull market cycle.” Crypto Dan, cryptocurrency market analyst.
Before continuing, it is necessary to clarify that this indicator created by David Puell is used to do technical analysis of Bitcoin. It is used to evaluate the profitability of the miners compared to its historical average. It is obtained by dividing the daily issuance of BTC, at the day's price in dollars, by the 365-day moving average of the price. This gives how high or low the miners' daily income is compared to its annual average. Specialists usually use it to detect entry or exit pointsbased on miners’ profitability. As seen in the chart below, the red areas mark cases where miners’ profitability decreases rapidly and this indicator plummets. “During the bull cycle in 2016 and 2020, this indicator dropped significantly, followed by the beginning of bitcoin’s sharp rise in 2024,” Crypto Dan details.
Red circles indicate that miners’ profitability decreases in a bullish cycle. Source: CryptoQuant. Based on this metric, the analyst argues that the start of the bullish rally would begin within the third quarter of 2024. “Currently, similar movements have been detected. Although it is difficult to be sure of the exact end of the adjustment period, it can be expected that it is not far away,” he argues. Currently, according to data from the Coinglass platform, The Puell multiple is 0.68, which can be interpreted as a low value.. When this metric is less than 1, it means that miner income is below the annual average. This could be an indication of an upcoming bullish phase. If this multiple were greater than 1, it means that income is very high compared to the annual average, suggesting that BTC could enter a price correction. On this point, it is worth remembering that analyst Willy Woo explained that miner capitulation is one of the reasons why BTC price is trading lowerIn other words, these are people who practice this activity, but could not cope with the reduction in rewards brought by the last Bitcoin halving. For Woo, once this situation is settled, There will be a significant rebound in the BTC priceOn the other hand, it is important to clarify that summer in the northern hemisphere (which ends in September) is mostly a period of lateralization or downward correction for financial markets. Therefore, there are greater probabilities that Bitcoin hits a new high historic after October.