Bitcoin Set for Another Boost as the Puell Multiple Metric Turns Bullish
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As Bitcoin (BTC) struggles to regain bullish momentum to recover from its recent crash, bulls have received an additional boost from a highly-revered metric to propel the cryptocurrency higher.
The Puell Multiple Metric has indicated a buy signal for the fifth time. Analysts claim that all four of its last bullish indications yielded positive outcomes.
Developed by on-chain strategist David Puell, the Puell Multiple is derived by dividing the daily issuance value of Bitcoins in USD by the 365-day moving average of that daily issuance value. The metric evaluates the supply aspect of BTC’s economy, including miners and their revenue, which has taken a severe hit from the increased China crackdown.
Based on the data mentioned above, the metric has a chart ranging from 0-10 (in extreme cases above 10). When the reading goes above 8, it translates to a sell signal, while a reading below 0.5 is a buy signal.
Interestingly, this metric has crossed below 0.5 only five times in its entire history. In the previous times it crossed below 0.5, it always marked the bottom of a down-trending market, and BTC spikes shortly afterward.
The most recent sighting was in June 2020, exactly a year ago. This sighting occurred a few months before the parabolic bull run of 2020/2021, where Bitcoin grew by six folds in a few months.
Key Bitcoin Levels to Watch — July 1
Bitcoin currently trades around the $33,750 level, following a sharp drop from Tuesday’s rally. The $33k support appears to hold just fine as the benchmark cryptocurrency rebounded from the level a few hours ago.
That said, we expect a recovery to the $35k level over the coming hours and days, followed by the $37k target. However, failure to clear $35k soon could foment weariness in bulls and prompt a retest of the $33k support or lower.
Meanwhile, our resistance levels are at $35,000, $36,000, and $37,000, and our key support levels are at $33,000, $32,000, and $31,000.
Total Market Capitalization: $1.38 trillion
Bitcoin Market Capitalization: $624.4 billion
Bitcoin Dominance: 45.3%
Market Rank: #1
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