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The 3 simplest indicators that will signal the next bull run.

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by COINS NEWS 105 Views

The 3 simplest indicators that will signal the next bull run.

Before I begin: Yes, I acknowledge that we're not yet in a bull market.

The purpose of this post is to simply help you anticipate the potential beginning of another bull run. A mistake most newbies make is to simply get caught up towards the end of the bull run, while their brains are fueled by FOMO and their pre-frontal cortex shuts down, causing them to make awful decisions motivated by greed, only to be left holding other people's bags. You can always justify this by googling "How bitcoin works?" and then make a post here shouting: IM IN IT FOR THE TECH!

That was me back in 2020-2021

Anyways, lets clear this out: A crypto bull run refers to a period in the cryptocurrency market where prices are consistently rising or expected to rise. By being able to antipicate the beginning of a bull run, will allow you to reap the most benefits, aka profits.

I want to keep this short and sweet. There are three simple key indicators/charts/trends that could signal the onset of a crypto bull run:

1. MVRV ratio

The Market Value to Realized Value (MVRV) ratio is a measure of whether a given asset is above or below fair value and it has a good track record of predicting Bitcoin's movements. Formula: Market Cap / Realised Cap (Realised Cap approximates the value paid for all coins in existence by summing the market value of coins at the time they last moved on the blockchain. Source: Glassnode)

A ratio above 3.25 typically indicates a bull market top, while below 1 indicates a bear market bottom.

Bitcoin's MVRV ratio has been consistently above 1.0 since the beginning of 2023, which means that the bottom was already reached sometime in 2022. This consistent trend means that we're slowly and steadily heading towards a new bull run.

https://preview.redd.it/v2rqj7mipr0b1.png?1783&format=png&auto=webp&s=98729e4a43f71373238a1bd3b8d809fca1a75f74

2. Total Market Cap

Total market capitalization, the combined value of all cryptocurrencies, indicates the health of the crypto market. A sustained bull run requires a steady capital inflow. A steady capital inflow indicates the build up towards a new bull run. It's important to look for trends here. For example, a year of steady capital inflow is a healthy indicator.

There's still a long way to climb but the market is indeed seeing steady inflows since the beginning of the year. Remember: Total market cap of the crypto market is still at $1.2T, on par with the total market cap of one single company in the US (Amazon).

https://preview.redd.it/nvowfa86qr0b1.png?1879&format=png&auto=webp&s=a9fa129d13e831c1c78a694d59a92272817c0b6d

3. Global Liquidity

Global liquidity is simply defined as the ease of access to credit and capital in financial markets, otherwise measured by interest rates. When liquidity is strong, markets thrive; when it's tight, markets suffer. Global liquidity has closely followed crypto trends in the past years. When money flows easily in to the economy, investors will look to throw their money into the riskier assets or just gamble them away. This means more customers in the casino. Bitcoin thrives in low interest environments. There's a high chance that interest rates have reached their peak and Central Banks are now hooked on their printing machines. Rates will come down at some point. (Hint: The timing might be around BTC's next halving = double whammy)

This is the part where should probably add some rocket emojis etc. but I'll just say that this maybe a hopium post, but it's based on facts and reliable indicators. You may disregard it, but honestly, those who know how to make money, always keep it simple. DCA during bear markets, wait for the bulls to cash out. 'Till next time.

submitted by /u/DerpJungler
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