U.Today – (BTC), the largest cryptocurrency by market cap, surged to highs of $58,487 in early Thursday’s trading session. However, amid this price surge, a prominent cryptocurrency analyst has issued a warning, urging caution as the market heats up.
According to Julio Moreno, head of research at CryptoQuant, valuation metrics indicate that the price of Bitcoin remains bearish.
Moreno said Bitcoin is still in a bearish phase and has decoupled from gold as investors shift into risk-averse mode.
In its recent analysis, CryptoQuant highlighted that the bull-bear market cycle indicator has been in a bearish phase since August 27, when the Bitcoin price was at $62,000. A significant rally is unlikely to occur as long as the indicator remains in the bearish phase.
Similarly, the MVRV ratio has fallen below its 365-day moving average since August 26. A cross below the 365-day moving average indicates the possibility of a further price correction. This situation was also present in May 2021, when Bitcoin fell by 36% in two months, and in November 2021, when the latest bear market began.
Bearish signs are also evident in spending by long-term Bitcoin holders (LTH) with lower profit margins. LTH SOPR ratios have been declining since late July. The fact that LTHs are spending with lower profit margins demonstrates a lack of new demand for Bitcoin.
Bitcoin briefly hits $58,000
Bitcoin (BTC) surpassed $58,000 in early trading on Thursday, boosted by a surge in U.S. stocks and gains in the Asian stock market.
US inflation data for August reinforced bets on a Federal Reserve rate cut in coming weeks, with core inflation rising faster than expected to more than 0.3%.
At the time of writing, BTC was up 2.18% over the past 24 hours to $58,025. However, U.S. spot bitcoin exchange-traded funds (ETFs) saw outflows again on Wednesday, following a two-day streak of inflows, and lost $43 million.
This article was originally published on U.Today
