Bitcoin network activity is “disappointing,” says the famed analyst, as other data confirms a sustained manual bottom in BTC price.
just needs another key on-chain signal for a classic bull market to begin, says analyst David Puell.
In a Dec. 17 tweet, the creator of Puell Multiple argued that the stage was almost set for the end of the BTC price bear market.
Puell: “Disappointing” Bitcoin Network Activity
Despite numerous calls for new BTC/USD lows of $12,000 or below this cycle, not everyone is completely bearish on Bitcoin’s prospects.
Puell already sees two key on-chain phenomena necessary for BTC price recovery.
Long-term (LTH) holders are resisting the urge to sell even as Bitcoin is down more than 70% from its recent all-time high.
At the same time, short-term “speculators” are feeling a sharp pain from recent price developments. As Cointelegraph reported, these “tourists” have likely already largely exited the market.
All that’s missing, according to Puell, is an increase in network activity from all participants.
“On-chain, three factors are necessary for a bull: 1. Holding behavior of long-term oriented investors. 2. Painful losses for short-term speculators. 3. Networking at all levels,” he summarized:
“Personally it’s always disappointing to see 1 and 2.3.”
He added that “favorable” macro conditions would facilitate the recovery, along with crypto becoming more resilient to “contagion” in the form of exogenous and endogenous “swans.”
According to data from Cointelegraph Markets Pro and TradingView, BTC/USD was trading around $16,700 at the time of writing.
BTC/USD 1 Hour Candlestick Chart (Bitstamp). Source: Trade View
A Bitcoin Halving Cycle Like Any Other?
This outlook is in line with others calling for calm regarding the current BTC price action.
Related: Bitcoin targets $16.7K amid fears BNB could drag down the entire crypto market
Among them is the popular anti-dilution analysis account, which on the day drew attention to BTC/USD simply copying past bear market behavior.
The evidence came in the form of Bitcoin’s MVRV z-score – an expression of cap market capitalization realized in standard deviations. Dilution resistance was originally referred to as the Market Value to Actual Value Temperature (MVRVT) metric.
Currently, the attached charts were showing signs pointing to a classic bear market bottoming, with the dilution evidence indicating that Bitcoin is “only doing what it is doing literally every cycle on this post-halving date.”
Market Value vs Realized Value (MVRVT) Bitcoin temperature chart. Source: Dilution Resistant/Twitter
Cointelegraph previously included MVRV-z in a list of “striking similarities” between 2022 and past price cycles.
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