While the pseudonymous analyst behind the bitcoin (BTC) stock-to-flow (S2F) model and an on-chain analysis firm are both expressing their bullishness on bitcoin, market sentiment is steadily improving for the number one cryptocurrency.
PlanB, the analyst behind the popular and sometimes controversial S2F model, tweeted yesterday that bitcoin is looking strong with a reading on the popular technical indicator Relative Strength Index (RSI) above 64.
“Bull market confirmed,” the analyst added, while sharing a chart that showed how the RSI has changed over bitcoin’s lifetime.
Commenting on the update from the popular analyst, one user dismissed the tweet by saying “it should already be priced in since it is public knowledge,” while another member of the crypto community argued that there are still few people that really understand bitcoin: “Who understands Bitcoin? Maybe 0.1%. Who understands the Bitcoin halvings? Maybe 0.001%. We are early. Nothing is priced in,” the Twitter user replied.
Meanwhile, according to on-chain analysis firm Glassnode, the bitcoin network’s net unrealized profit & loss has broken into what they call the “belief” zone on the chart. According to the firm’s model, this is the stage of a bull market where traders largely believe in the rally, and it comes before the more extreme phase of the bull market called the “euphoria” stage, which the bitcoin market last entered in 2017.
Net Unrealized Profit/Loss (NUPL) broke in to the “Belief” zone for the first time over a year.
Its current value is lower than the last time $BTC hit $12,000 – suggesting potential for more price upside from here.#Bitcoin
Chart: https://t.co/iydz8pAW6V pic.twitter.com/Q7vgdi9S8Z
— glassnode (@glassnode) August 18, 2020
The net unrealized profit & loss measures the difference between the unrealized profit and unrealized loss of bitcoin holders, meaning how much investors would stand to gain or lose if all bitcoins were sold at the current market price.
Similarly, blockchain data for the bitcoin network from analytics firm IntoTheBlock also revealed that a large majority of bitcoin holders are in the green on their investment at current prices, with 91% of holders estimated to be “in the money.”
The high share of profitable bitcoin holders has contributed to a sentiment boost towards the cryptocurrency, although a decline in the growth of new wallets and a reduction in large transactions made have contributed to an overall “neutral” outlook for the bitcoin price, according to the firm’s algorithms.
Meanwhile, as reported, Bitcoin price failed to extend gains above USD 12,500 and started a corrective decrease. It dropped below the USD 12,200 and USD 12,000 support levels, currently (10:53 UTC) trading below USD 12,000 and it might continue lower towards the USD 11,550 support zone.