- The current Puell Multiple range suggests a markdown in Bitcoin’s price, indicating that the network could be undervalued.
- Calls to “buy the dip” are expected to increase in the near future.
- Bitcoin price support at $67,000 is crucial to arrest further downside.
Discover why the current Bitcoin Puell Multiple signals a potential buying opportunity and what it means for future price movements.
Bitcoin Puell Multiple Flashes Buy Signal
Following a recent attempt to surpass $72,000, Bitcoin encountered persistent selling pressure. At present, the Bitcoin (BTC) price stands at $67,536, reflecting a decline of 2.69%, with a market capitalization of $1.331 billion. Should BTC fail to maintain support at $67,000, it may potentially decline to $64,000.
Impact of Bitcoin Halving on Puell Multiple
Bitcoin undergoes a halving roughly every four years, resulting in a halving of the mining reward per block, directly impacting miners’ earnings. Consequently, miners experience a substantial decrease in daily revenue unless Bitcoin’s price sees a significant surge to offset this reduction.
The Puell Multiple, which measures the ratio between daily revenue and the 365-day moving average, witnesses a sharp decline post-halving. This is due to the lag in the adjustment of the long-term moving average to the new mining reward reality.
This reduction in miners’ daily revenue signifies a less profitable mining environment unless Bitcoin’s price sees a notable uptick. The current Puell Multiple range indicates a price discount, suggesting that the network may be undervalued, reports CryptoQuant.
Moreover, the decrease in the supply of new Bitcoins could potentially drive prices upward, particularly if demand continues to rise. Investors may interpret the Puell Multiple’s decline as a signal that the market is adapting to a new phase of scarcity, potentially setting the stage for a market rally.
Consequently, this phenomenon could signify a period of adjustment in the mining sector, impacting Bitcoin’s supply and demand dynamics and potentially foreshadowing significant price movements in the future.
BTC Price Consolidation
Although the BTC price rallied to $72,000 earlier this week, we’re still not out of the Bitcoin consolidation phase as reported earlier this week. As per the historical trends and post-halving behavior of Bitcoin, it would still take a few more weeks for Bitcoin to give a fresh breakout and enter the price discovery zone.
Once this happens, the BTC price will be all set to rally to $100,000 by the end of this year.
Conclusion
The current state of the Bitcoin Puell Multiple suggests that the network may be undervalued, presenting a potential buying opportunity for investors. As the market adjusts to the post-halving environment, significant price movements could be on the horizon. Maintaining support at $67,000 is crucial to prevent further downside, and a breakout could set the stage for a rally towards $100,000 by year-end.
