Bitcoin proponents are not losing faith in the possibility of a comeback for the big bull, and a number of these proponents have reiterated this in reference to different bullish observations made over the week.
Different metrics have been fueling bullish expectations, and one of the newest ones comes from the on-chain analyst William Clemente, who breaks down where the market is currently at, and the surprising destination it shows itself to be headed to.
Incoming bull rally in less than a month?
In a recent on-chain analysis titled “calm before the storm,” (a reference to the perceived bull rally that is expected to precede the current bear market) the analyst points out what the pseudonymous Bitcoin trader John Wick has previously noted; the tightening of the Bollinger Bands indicator, following two volatility squeezes.
The orange shaded area on the above chart, at the top left “is telling you that there is a big move coming,” explained Clemente, who goes on to reference July 2020, when the first of the volatility squeeze that sent the market to new highs was recorded. Following that, back in April 2021, another volatility squeeze sent the market back to a bearish state.
Breaking the expected outcome, he maintains certainty that the market is well-positioned to make a significant jump anywhere from now and the next 21 days.
“Each time, these squeezes took 1 to 3 weeks to resolve, so theoretically we could be looking at this big move in the next few days but could take up to those full 3 weeks. – Williams Clemente.
It is important to note that the directionality of the market is 50/50. While a bull run could follow based on historical patterns, a bear market could also kick in, and either of both is poised to shake up the market significantly.
Ongoing accumulation trend signals another bullish possibility
Going forward, another broader trend that reflects a possible bullish formation has been spotted. Accumulation has been taking place greatly, as a new pattern shows that there has been a downtrend in the ratio between coin days destroyed, and coin days created.
When Bitcoins are sent into a wallet and are not moved for a certain period of time, the number of days make up “coin days accumulated.” If and when the coin is spent, the number of days accumulated has now been destroyed.
So far, there has been a downtrend that signals accumulation. This downtrend has historically been found to take place in the midst of different market stages.
As Clemente’s post reads, “This [the downtrend] has marked the beginning of bear markets post-2011, post-2013, and post 2017. However, this also took place between 2013 double pumps as well as before the bull run began last year.”
Conclusively, this trend like the former signals an incoming bull or bear market. But even though there is no telling which it will be, market recovery is already taking place. And eventually, Bitcoin is bound to go greener.