Although Bitcoin could not cross the $70,000 price mark for more than 2 months now, the asset has made efforts to stay above the $60,000 price.
Amidst this correction above the $60,000 price level, analysts have continued to speculate on the future trajectory of BTC especially when the asset will make the game out of the long-awaited rally to the top.
One such analyst, CryptoBullet on X, has it he brought attention on a certain indicator— the Puell Multiple— which suggests that Bitcoin may reach a new all-time high (ATH).
Understanding the Puell Multiple
According to CryptoBullet, the behavior of the Puell Multiple indicator often correlates with the cycles of the Bitcoin market, which may provide a clue as to where the asset is headed next.
The Puell Multiple, calculated by dividing the daily output of Bitcoin in USD by the 365-day moving average of daily output, is used as a measure to understand the profitability of miners and their potential impact on the price of Bitcoin.
Historically, when the Puell Multiple enters the “Green Zone,” it has indicated that Bitcoin is likely to reach a market bottom, which often precedes a significant upward trend. CryptoBullet points out that this phase of the cycle often sees Bitcoin break out of the bottom before starting its ascent to a new ATH.
#BTC Puell Multiple index
That’s why I think $BTC it is not finished and we will get a new ATH soon
According to this chart, #Bitcoin Bear markets end (#BTC gets the lowest) when the Puell Multiple hits the green
Then Puell Multiple jumps like $BTC price print… pic.twitter.com/pL1ShFxcwE
– CryptoBullet (@CryptoBullet1) October 6, 2024
Bitcoin Puell Many Tips At The Highest New Opportunities Of All Time
CryptoBullet analysis shows how the Puell Multiple has behaved in different market cycles. Specifically, he noted that Bitcoin bear markets often end when the Puell Multiple hits the Green Zone, where Bitcoin finds its bottom.
Once this low is confirmed, the Puell Multiple begins to jump, indicating the first significant upward leg in Bitcoin’s price movement. The importance of the Puell Multiple, according to CryptoBullet, lies in its pattern of “high lows” and “high highs.”
After reaching the Green Zone, the price of Bitcoin often faces a mid-term correction with the Puell Multiple creating a new high low. From this point, both the price of Bitcoin and the Puell Multiple tend to go higher, often reaching higher.
Currently, CryptoBullet believes that Bitcoin is in the early stages of its next significant leg. A high low and a potential high high in the Puell Multiple may indicate that both the price of Bitcoin and its market momentum are in line with another rally.
In the context of Bitcoin’s current trajectory, this suggests that a new ATH breakout is imminent.
The featured image was created with DALL-E, a Chart from TradingView