#101 On-chain Insights by IT Tech 💡🧠 - Week 44 Highlights & Analysis
Weekly BTC & Crypto Market Analysis: Insights into Miners’ Behavior, Stablecoin Correlations, and Market Trends.
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Table of Contents
🔸 Partnership with WymienBitcoina.pl
🔸 Current market situation
🔸 Bitcoin price and key levels
🔸 Bitcoin Spot ETF - flow and reserve analysis
🔸 On-chain heatmap - comprehensive BTC indicator analysis
🔸 Correlation between USDT and USDC market caps and Bitcoin price
🔸 Paid newsletter subscription - support content development
🔸 BTC miners' behavior
🔸 Bitcoin reserves on Exchanges
🔸 Newsletter issue summary
🔸 The exchanges I trade onPartnership with WymienBitcoina.pl
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Current market situation.
Last week saw fluctuating market sentiments, with Bitcoin's price approaching its all-time peak before experiencing a notable decline, which severely impacted Ethereum and other altcoins. Meanwhile, Bitcoin's dominance has been increasing (60.28%), suggesting that capital inflow into Bitcoin remains robust.
Let's dive into the current market situation from the perspective of on-chain movements.
Bitcoin price and key levels.
A pullback in the price of BTC of almost 7%. Meanwhile, take a look at the ETHBTC pair: Ethereum continues to lose ground against Bitcoin. When this trend starts to reverse (if it does) there will be hope for ETH and altcoins.
As of November 3, 2024, here are the updated key support and resistance levels for Bitcoin:
🔹 BTC Price: $68,669 - Currently positioned above several key indicators, indicating a positive price outlook.
🔹 SMA 365D: $57,465 - This moving average acts as a strong support, indicating a long-term upward trend.
🔹 Realized Price: $33,106 - Highlights that long-term investors are in profit, supporting the continuation of the upward trend.
🔹 STH Realized Price 1W-1M: $64,767 - Short-term support level that could cushion any profit-taking by short-term investors.
🔹 STH Realized Price 1M-3M: $60,302 - Another support level for short-term holders, potentially attracting accumulation if the price dips to this level.
🔹 STH Realized Price 3M-6M: $64,608 - Indicates an additional support level, helping to stabilize the price if a pullback occurs.
Conclusion:
The current price of BTC is well above the realized prices of key short-term holders, suggesting the likelihood of further increases. The main resistance level has been breached, and there is strong support in the $60,000 to $64,800 range, offering a stable base for any potential pullbacks.
Bitcoin Spot ETF - Flow and Reserve Analysis.
Daily Inflows and Outflows (28.10 - 01.11):
October 28: +6,645 BTC
October 29: +12,271 BTC
October 30: +12,074 BTC
October 31: +831 BTC
November 1: -1,083 BTC
Insights:
Strong inflows from October 28 to October 30, with a peak on October 29 at +12,271 BTC.
A smaller inflow on October 31 (+831 BTC), followed by a significant outflow on November 1 (-1,083 BTC), possibly indicating some profit-taking or repositioning by investors.
Ethereum Weekly Net Inflow and Price Summary (October 28 - November 1, 2024)
Weekly Summary:
Total Net Inflow: +$13.00M
ETH Price Movement: From $2,507.21 to $2,518.37
Daily Breakdown:
October 28:
Net Inflow: -$1.10M
ETH Price: $2,507.21
Note: Slight outflow with stable price.
October 29:
Net Inflow: +$7.60M
ETH Price: $2,566.48
Note: Significant inflow, price rises.
October 30:
Net Inflow: +$4.40M
ETH Price: $2,639.28
Note: Continued inflow, higher price.
October 31:
Net Inflow: +$13.00M
ETH Price: $2,659.35
Note: Strong inflow supports price increase.
November 1:
Net Inflow: -$10.90M
ETH Price: $2,518.37
Note: Significant outflow, price drops.
Conclusion:
Despite a strong accumulation mid-week, the week ends with a notable outflow, leading to a slight decline in ETH price. This reflects a mix of bullish sentiment and profit-taking behavior.
On-chain Heatmap: Comprehensive Analysis of BTC Metrics.
Interpretation of Indicators 👇
The "Onchain Metrics Heatmap" offers a novel approach to analyzing a variety of blockchain metrics collectively. A value approaching 1 signals that the indicator is at extreme levels, while values near 0 indicate lower levels. Historically, accumulating BTC when the heatmap shows values below 0.1 has proven to be an excellent opportunity. Conversely, when multiple indicators approach 1, it suggests a prudent time to consider profit-taking.This heatmap serves as a valuable tool for gauging market sentiment and guiding strategic investment decisions.
On-chain analysis for Bitcoin from October 28 to November 2, 2024:
Key Insights:
NUPL (Net Unrealized Profit/Loss) (MA 7):
Gradually increased from 0.783 to 0.796, indicating growing unrealized profits among investors. This suggests that more holders are in a profitable position.
SOPR (Spent Output Profit Ratio) (MA 7):
Rose slightly from 0.637 to 0.670, implying that more transactions are occurring at a profit, reflecting increasing market confidence.
SOPR (MA 90):
Stabilized around 0.641 to 0.660, indicating consistent profit realization over the longer term without significant spikes or dips.
aSOPR (Adjusted SOPR) (MA 7):
Increased slightly from 0.437 to 0.460, showing a marginal rise in profitability for adjusted transactions, hinting at cautious optimism among traders.
STH SOPR (Short-Term Holder SOPR) (MA 7):
Slightly increased from 0.426 to 0.450, suggesting that short-term holders are realizing profits more frequently, which could lead to short-term market corrections.
MVRV (Market Value to Realized Value):
Fluctuated between 0.358 and 0.383, indicating that the market value of Bitcoin is moderately above its realized value, reflecting a stable but cautious market sentiment.
CDD (Coin Days Destroyed) (MA 90):
Remained stable around 0.239 to 0.247, showing no significant movement of older coins, which suggests low selling pressure from long-term holders.
MVRV Z-Score:
Remained stable from 0.224 to 0.237, suggesting the market is not in extreme euphoria or panic, indicating a balanced state.
LTH SOPR (Long-Term Holder SOPR) (MA 7):
Increased slightly from 0.069 to 0.062, showing minimal profit realization among long-term holders, indicating strong conviction.
Fees per Transaction (USD) (SMA 7):
Stayed relatively low, between $0.034 and $0.041, implying stable network usage and a calm market environment.
Summary:
During this period, Bitcoin’s on-chain metrics show a stable to slightly bullish market sentiment. The rise in NUPL and SOPR metrics suggests growing confidence and profitability among investors. Short-term holders are realizing more profits, but long-term holders remain steadfast. Low transaction fees indicate steady network activity without excessive speculative behavior.
Correlation between USDT and USDC market caps and Bitcoin price.
In the dashboard I use to prepare the weekly analysis for you, there's also a very interesting chart by Julio Moreno.
An increase in the market capitalization of stablecoins (USDT and USDC) is often correlated with a rise in Bitcoin prices, suggesting greater liquidity and demand in the market.
A decrease in stablecoin market capitalization may indicate increased cryptocurrency selling and reduced liquidity, which could lead to a drop in Bitcoin prices.Daily USDT Market Cap Change from October 28 (in million USD):
🔹 2024-10-28: +137.31M USD
🔹 2024-10-29: -88.03M USD
🔹 2024-10-30: +147.81M USD
🔹 2024-10-31: -41.47M USD
🔹 2024-11-01: +193.70M USD
🔹 2024-11-02: +21.36M USD
Net USDT Market Cap: +370.68M USD
Daily USDC Market Cap Change from October 28 (in million USD):
🔹 2024-10-28: +76.56M USD
🔹 2024-10-29: +115.15M USD
🔹 2024-10-30: +189.84M USD
🔹 2024-10-31: -282.22M USD
🔹 2024-11-01: +96.97M USD
🔹 2024-11-02: +12.78M USD
Net USDC Market Cap: +209.08M USD
Total Market Cap Change for USDT and USDC: +579.76M USD (from October 28 to November 2)
Conclusion:
The positive net market capitalization change of +579.76 million USD for USDT and USDC indicates a growing demand and liquidity in the cryptocurrency market. This increase in stablecoin market cap reflects a heightened investor interest, which could potentially lead to a rise in Bitcoin and other asset prices in the upcoming days if the trend continues.
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BTC miners’ behavior.
Bitcoin miner reserves from October 26, 2024, to November 3, 2024:
October 26, 2024: 1,815,216.92 BTC
November 3, 2024: 1,812,204.14 BTC
Change in Miner Reserves: The miner reserves have decreased by approximately 3,012.78 BTC during this period.
There’s a noticeable increase in BTC transfers from miners to exchanges. The Miners’ Position Index (MPI) effectively highlights the market impact. Typically, when MPI turns positive, Bitcoin price corrections follow. Monitoring miners' behavior is crucial for the crypto market. Keep an eye on my X/Twitter profile and turn on notifications 🔔 to stay updated on the latest developments.
Bitcoin reserves on Exchanges.
Bitcoin Exchange Reserve Update. Between February 9 and November 2, 2024, around 421,909 BTC has been withdrawn from exchanges.
Highlights:
Week 37: 46.2k BTC outflow
Week 42: 41.99k BTC outflow
This trend suggests a notable shift of BTC off exchanges, possibly signaling increased HODLing. Could this lead to a future supply shock?
Newsletter Issue Summary
TL;DR Summary:
Market Overview: Bitcoin's dominance is rising, despite mixed market sentiments. A recent 7% price pullback has significantly affected altcoins.
Key Levels: BTC is trading above crucial indicators, indicating a positive outlook.
BTC Spot ETF: Institutional interest is growing due to BTC Spot ETFs. Monitoring ETF inflows/outflows can reveal market sentiment and price trends.
Miner Behavior: Increased BTC transfers from miners to exchanges could suggest market corrections. Keep an eye on the Miners' Position Index (MPI) for potential selling pressure.
Stablecoin Correlation: Growing USDT and USDC market caps point to increased liquidity, which could drive BTC prices up.
Paid Subscription: Offers early access to exclusive content, premium charts, and direct insights into market trends.
Forecast for the Upcoming Week:
BTC Miners' Behavior: Keep a close watch on MPI and miner-to-exchange flows for any signs of market corrections.
Stablecoin Market Caps: Track the changes in USDT and USDC for signals on liquidity and market demand.
BTC Support Levels: The $60K - $64.8K range is critical as a safety net for potential pullbacks.
ETF Flows: Institutional sentiment can be gauged by observing ETF net inflows and outflows.
Volatility During US Presidential Election: Exercise caution with leverage due to anticipated volatility around the election period.
Stay alert and monitor these key indicators for better market insights.
You can track important upcoming market events in the US and the EU using the Economic Calendar, which offers free access
Patience in investing pays off by understanding the market's cyclical nature and recognizing the recurring patterns and behaviors of investors.💡Take a look at the indicators used in the dashboard. For current updates from the market, of course, drop by me on X/Twitter and the free Telegram channel.
Remember to realise profits regularly.💡
This concludes this issue. I hope you have a pleasant end to your weekend and a great week ahead. 🤝
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Please note that the information in this article reflects my personal views on the cryptocurrency market and should not be taken as investment advice or recommendations. Investing in cryptocurrencies involves a high risk of losing capital. This article includes brand mentions of WymienBitcoina.pl and affiliate links to services that may provide benefits to the author.
Best regards
IT Tech