The price of Bitcoin has been fluctuating recently, leaving many investors uncertain about the future of the premier cryptocurrency. Despite the lack of a clear breakout to new highs, there are signs that the current bull cycle may still have some steam left. In this article, we will delve into the latest on-chain observations that suggest Bitcoin is going through a phase known as the “Euphoria Wave” and explore what this means for the current market conditions.
The Euphoria Phase
According to data from blockchain intelligence firm Glassnode, Bitcoin has entered the euphoria phase of the market cycle. This phase is characterized by heightened investor sentiment and increased market speculation, leading to a surge in the price of the cryptocurrency. The “Percent Supply in Profit” metric, which measures the percentage of the total circulating Bitcoin supply that is currently in profit, has been hovering around 90%, indicating that Bitcoin is in a state of euphoria. Glassnode’s data shows that 93.4% of the circulating Bitcoin supply is currently in profit, and the Euphoria Wave is still relatively young, having been active for only about two and a half months.
While the Euphoria Wave is a positive sign for Bitcoin’s price movement in the short term, history suggests that it may also signal a market top. The euphoria phase is typically followed by a cooling-off period, during which the price of Bitcoin tends to decline. If we look at past cycles, a 6-month Euphoria Wave could indicate that there are still a few months left in the current bull run. Therefore, investors should proceed with caution and be prepared for potential price corrections in the near future.
Despite the choppy price action of Bitcoin, there are indications of bullish sentiment in the market. According to an on-chain analyst on CryptoQuant’s platform, there has been a notable increase in the number of new BTC accumulation addresses, suggesting that investors are still accumulating Bitcoin despite its current price levels. Additionally, large Bitcoin holders have been increasing their holdings, making significant purchases over the past month. These trends indicate that investors remain optimistic about the future price movement of Bitcoin.
As of the latest data, Bitcoin is valued at $67,744, reflecting a slight 0.4% increase in the last 24 hours. Over the past month, the cryptocurrency has seen a 15% increase in its price, indicating a positive trend in the market. However, investors should remain cautious, as the euphoria phase may be nearing its end, potentially leading to a price correction in the coming months.
The current market conditions for Bitcoin are uncertain, with the cryptocurrency being in the euphoria phase of the market cycle. While this phase may lead to further price appreciation in the short term, investors should be prepared for potential market corrections in the near future. It is crucial to monitor on-chain data and market sentiment to make informed decisions about Bitcoin investments in the coming months.