A classic on-chain indicator of Bitcoin (BTC) has recorded an impressive rebound even as the asset’s price action remains uncertain.
In a tweet of 9 July, Philip Swift creator of the analysis resource Look Into Bitcoin, highlighted a drastic change of course for the Puell Multiple.
Puell’s advance and hash rate are “a good sign”
one metric enough simple Puell’s multiple tracks miners’ activity in order to understand the extremes of the Bitcoin market.
It has worked very well as an indicator of when btc’s price is likely to have marked ceilings and floors, and at the end of June it plunged into its green zone of “buy” for only the fifth time in history.
Thanks in part to last weekend’s record-breaking mining difficulty readjustment, Swift says. Puell’s multiple has now reversed course upwards, and if it does, logically it should raise the price of BTC.
“Fuck bounce out of the green zone this week for puell’s multiple,” he summed up.
“Largely due to the adjustment of the difficulty and the increase of the hashrate. It will be a good sign if we see that this and the hash rate continue to rise rapidly as bitcoin miners jump back on the bandwagon.”
As Cointelegraph has already told you, miners resuming operations after being displaced from China will create more competition and boost Bitcoin’s hash rate, and the difficulty will rise again to account for these changes.
Estimates vary widely as to when the turbulence affecting mining will actually end.
meanwhile an upward reversal of this metric could herald a definite floor in the price of Bitcoin. how recently observed the trader and analyst Rekt Capital, declines in the green zone tend to be followed soon after by a floor of the BTC/USD pair.
The journey to the green zone itself comes as Bitcoin is still preparing to mark the ground, and is not fully aligned with price behavior.
The importance of unlocking Grayscale
Bitcoin price action is showing strength as the weekend progresses, something that could, however, lead to a reversal in line with recent short-term trends.
Grayscale’s upcoming unlocking events remain a topic of conversation, but the opinions differ as to whether the BTC/USD pair will be affected.
“This theme is the next big narrative,” said trader Michaël van de Poppe in a update on Saturday, putting it next to issues like the expiration of Bitcoin options.
He added that negative bias is already active in all cryptocurrency markets, which can give undue credibility to unlocking as a threat to price stability.