Bitcoin rebounds to $97,727 as institutional inflows drive optimism and on-chain metrics suggest room for growth to a new all-time high.
As the crypto market liquidation surpassed $500 million over the past 24 hours, Bitcoin BTC $97 825 24h volatility: 0.4% Market cap: $1.94 T Vol. 24h: $133.58 B registered a 24-hour low at $94,306. However, BTC price has since bounced back and reached a market price of $97,727.
This bullish comeback in BTC price coincides with a rise in institutional demand. Further, the recovery rally gradually undermines the short-term correction.
The US spot Bitcoin ETFs registered a daily total net inflow of nearly $440 million in the institutional race to accumulate BTC.
BlackRock led the way yesterday with a $295.63 million inflow. Following in its footsteps, Fidelity accumulated $210.48 million worth of BTC over the past 24 hours.
This has led to the total net assets of the US spot ETFs reaching $107.76 billion, or 5.65% of the BTC market cap. Out of 12 registered BTC ETFs, 5 recorded a net positive flow, while 3 recorded a net outflow, leaving 4 ETFs with a net zero flow.
As the recovery in BTC gains momentum, the on-chain indicators are starting to flash a buy signal.
One of the underrated metrics in crypto, mean dollar invested age, supports this signal as the market gradually recovers from the recent retracement.
Based on the on-chain indicator, the mean age of BTC investments is down to 439 days. This translates to a 31% younger mean age over the past 60 weeks.
Furthermore, for XRP XRP $2.33 24h volatility: 4.8% Market cap: $133.12 B Vol. 24h: $26.43 B , the mean age of investment is down to 865 days, making it 22% younger over the past 14 weeks. Meanwhile, Dogecoin’s DOGE $0.39 24h volatility: 4.2% Market cap: $57.99 B Vol. 24h: $10.89 B mean investment age has dropped to 370 days, making the DOGE 31% younger over the past 8 weeks.
The mean dollar age invested line drops for Bitcoin, and the top altcoins signal that the older and stagnant wallets are circulating the dominant coins. As the circulation comes from large key stakeholders or whales, the increasing network activity marks a healthy signal for the bull run.
The mean age of investment is a critical indicator that has proved its mettle in the 2017 and 2021 bull markets. In the previous bull runs, the markets peaked and started going down when the mean ages started increasing or getting older again.
Hence, despite the short-term price fluctuations in Bitcoin and the top altcoins, the drawdown in the mean age of investment signals a medium to long-term bullish market.
Another key on-chain indicator for predicting the bull market’s peak is the market-value-to-realized-value ratio. This is the market cap ratio to each address’s average purchasing cost.
Currently, the MVRV ratio stands at 2.55 compared to the 2021 bull run peak of 3.68. In the 2017 bull run, the MVRV ratio peaked at 4.24 and 4.91 in 2013.
As the MVRV ratio continues to fall during consecutive bull runs’ peak, it remains a crucial signal for predicting bullish exhaustion. At 2.55, the on-chain indicator signals room for growth.
As the BTC price bounces from the crucial support of $94,425, it marks a V-shaped recovery to challenge the short-term resistance trendline. The recovery rally has surpassed the 50 SMA line in the 1-hour chart.
Further, it tests the resistance confluence of the 38.20% Fibonacci level at $97,945 and the resistance trendline. The short-term pullback has resulted in a death cross in the early time frame and warns of a bearish crossover between the 200 and 100 SMA line.
Source: Tradingview
As the recovery rally gains momentum with the rising ETF inflows, the chances of a breakout rally have fundamentally increased. However, the BTC price action showcases the formation of low-range price candles as they reach the resistance zone.
This warns of another potential pullback to retest the 23.60% Fibonacci level at $96,600. Nevertheless, with the on-shell indicator signaling a bullish run ahead, the breakout of the local support trendline will provide a buying spot point for price action traders.
With this breakout rally, the Fibonacci levels paint significant resistance at the 61.80% Fibonacci level near the $100,000 psychological mark. Closing above this will increase the chances of BTC reaching the $103,647 mark, potentially creating a new all-time high.
Based on the Fibonacci levels, the price targets for a new all-time high are $106,145 and $109,333.
In conclusion, with the intraday recovery and on-chain signals, the bull run in Bitcoin shows the potential to sustain the minor hiccup.
Disclaimer: Coinspeaker is committed to providing unbiased and transparent reporting. This article aims to deliver accurate and timely information but should not be taken as financial or investment advice. Since market conditions can change rapidly, we encourage you to verify information on your own and consult with a professional before making any decisions based on this content.
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Vishal, a Bachelor of Science graduate, began his journey in the crypto space during the 2021 bull run and has since navigated the subsequent market winter. With a strong technical background, he is dedicated to delivering insightful articles rich in technical details, empowering readers to make well-informed decisions.
