Near the end of the Bear Market

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(Edited)

After the Terra-Luna "case," on which more and more speculation of externally maneuvered hacking is piling up, today we are witnessing the second major downward manipulation event on crypto, coordinated this time between the media and some alleged money launderers who are suddenly "spilling the beans" about their malfeasance carried out, it seems, on Binance.

Those who have been following this market for some time have learned to recognize these well-conceived actions that are intended to bring the bear market to its breaking point (and also, perhaps, to lower prices for the benefit of institutional holders who continue to accumulate on the declines).

For our part, we can only look forward to any event that stirs the waters a bit and gives an extra boost to this sleepy bear market, moving it toward its final phase.

But let's get down to more serious stuff, namely Glassnode's usual charts, which are really instructive today
With prices now having fallen to the lower end of the 2021-22 cycle range, only 15 percent of traders who had bought coins in the past 17 months have not shed their coins and are still maintaining unrealized losses.

As profit multiples compress across the board and financial stress increases, we are approaching the second, historically conclusive phase of Bitcoin's bearish market capitulation (in which probably only 5 percent of traders will still get to keep loss-making coins).

Thus, the time has come when Glassnode is also beginning to make assumptions about when the crypto bear market might end.

To do so, he has used two key indicators that I have already discussed in past months: the first is the Mayer Multiple (mentioned by me on February 8 - post), which I comment on in the following two charts.

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In the chart I published on February 8, the indicator had fallen for the first time to the 0.8 level, which marks the oversold guard level.

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This week for the first time the Mayer Multiple fell to 0.6, which is below the guard level.

As indicated by the pink circles, this drop to 0.6 is a rare event (it has occurred on only 8% of the trading days since 2012 to date).

From a probabilistic point of view, therefore, the oversold level indicated by the indicator should be considered conclusive of the bear market.

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The second indicator is the Realized Price (I suggest the May 17 post for those who want a more thorough explanation of this metric).

Just on the basis of Glassnode's chart, I had set the price around $23,000 (just below the realized price of $24,000 marked by btc on March 17) as a possible end point of this bear market.

Well, this indicator too, like the previous one, came in below the guard level, that is, at $23,600, which is below the Realized Price of 24,000.

And this chart too, like the previous one, shows with pink rectangles the extreme rarity of the event, which in this case has occurred in only 15 percent of the trading days that have elapsed from 2012 to the present.

Moral of the story: both indicators, among the "oldest" and most reliable in marking the cyclical timing of btc, are very clearly signaling an ending phase of the bear market.

One aspect of the market that has not been understood by the media, whose only concern is reporting data in the alarmist ways that attract the most readers, is the increase in btc sales by miners. In order not to burden our posts, on this topic and on a couple of interesting private capitalizations regarding the ethereum network I decided to publish a dedicated article.

SOURCES AND FURTHER READING

GLASSNODE INSIGHTS

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