Bitcoin (BTC) has issued a rare bullish signal in its risk-reward profile, as multiple indicators have turned "green".
Key Points:
Bitcoin price indicators show a multi-year risk-reward opportunity.
While it cannot be guaranteed that the BTC price has bottomed out, the opportunity for buyers has "become more attractive".
Data increasingly mimics the situation at the end of the 2022 bear market.
Data from the on-chain analysis platform CryptoQuant confirms that Bitcoin's Sharpe ratio has reached a multi-year low.
In terms of risk-reward, Bitcoin is more attractive as an investment than at any time since mid-2023.
The Sharpe ratio, a classic economic tool used to assess the investment risk of an asset, has entered its "green" zone for the first time since June of that year, falling below zero.
"We are now entering the same zone seen in 2019, 2020, and 2022, where the Sharpe ratio stayed at structurally low levels for a while before a new multi-month trend emerged," wrote CryptoQuant contributor MorenoDV in his "Quicktake" blog post.
The Sharpe trend continued to decline into negative territory before reversing, driving prices to change as well. Its last long-term bottom appeared in November 2022, about two months before the last crypto bear market ended.
Therefore, Moreno suggests that the indicator needs to start reversing upwards for users to breathe a sigh of relief.
"Bitcoin has not yet signaled a trend recovery, but it indicates that the risk-adjusted outlook is becoming more attractive," he emphasized.
Elsewhere, another commonly used BTC price indicator also suggests a similar return.
The Bitcoin Heater, created by quantitative Bitcoin and digital asset fund Capriole Investments, has similarly returned to the green zone.
Capriole explains that this indicator measures the "relative heat of Bitcoin perpetual contracts, futures, and options, weighted by open interest," currently at 0.09—its lowest level since November 2022.
"We have some significant resistance to address (like institutional sell-offs), but I can't be bearish when the heater is in deep green today + the fundamental value is rising across the board," founder Charles Edwards commented in a post on X.
Edwards also uploaded a chart of Bitcoin's dynamic range network value to transaction (NVT) ratio, which now shows it as "oversold" relative to on-chain transaction value.
Meow??? How high can the cat bounce? pic.twitter.com/oOrvncOLlH
As Cointelegraph continues to report, various market participants still do not believe a bull market can return.
This includes long-term trader Peter Brandt, who likened the rebound of BTC/USD from a low of $80,500 to a so-called "dead cat bounce," as part of a broader downtrend.
Related: Bitcoin (BTC) Sharpe ratio near zero signals rare risk-reward opportunity
Original: “Bitcoin (BTC) Drops to $87,000: Is it a Buying Opportunity or a 'Dead Cat Bounce'?”
免责声明：本文章仅代表作者个人观点，不代表本平台的立场和观点。本文章仅供信息分享，不构成对任何人的任何投资建议。用户与作者之间的任何争议，与本平台无关。如网页中刊载的文章或图片涉及侵权，请提供相关的权利证明和身份证明发送邮件到support@aicoin.com，本平台相关工作人员将会进行核查。
