A quant has explained that the past pattern in the bitcoin buyers bid-sell ratio metric may suggest the best window to start selling the asset.
bitcoin Taker Buy and Sell Ratio May Reveal Selling Opportunities
In a quick shot from CryptoQuant btc-when-this-happens-taker-buy-sell-ratio” target=”_blank” rel=”nofollow”>mail, an analyst analyzed the trend in bitcoin's “buyer bid-sell ratio.” This indicator tracks the relationship between the buying and selling volumes of bitcoin buyers.
When the value of this metric is greater than 1, investors are willing to purchase coins at a higher price at this time. This trend implies that bullish sentiment is the dominant force in the market.
On the other hand, the indicator below the mark suggests that the selling pressure may be greater than the current buying pressure in the sector. As such, most may share a bearish mindset.
Now, here is a chart showing the trend in the 30-day moving average (MA) bitcoin buyer bid-sell ratio over the past few years:
<img decoding="async" class="alignnone aligncenter" src="https://technicalterrence.com/wp-content/uploads/2024/04/Start-selling-Bitcoin-when-this-happens-says-this-Quant.png" alt="bitcoin Taker Buy and Sell Ratio” width=”1280″ height=”621″ loading=”lazy” data-recalc-dims=”1″/>
The 30-day MA value of the metric appears to have been going down in recent days | Source: btc-when-this-happens-taker-buy-sell-ratio" target="_blank" rel="nofollow">CryptoQuant
As the chart above shows, the 30-day bitcoin MA buyers bid-sell ratio has recently fallen below level 1. The quant has highlighted on the chart the region of the metric where the bull run peak formed in 2021.
The indicator would appear to fall below 0.97 during the two highs recorded in that bull run. According to the analyst, these indicator values suggest the euphoric phase of the market in which smart money begins to sell. Still, prices continue to hold up as retail investors continue to apply FOMO to the asset.
So far, the indicator has approached the 0.98 level in its latest decline, implying that it is not yet at the levels where the possibility of a top could become significant considering the pattern of the previous bull run.
The bitcoin buyer bid-sell ratio can also be used as a buy signal, with the 1.02 level being an important level. The quant points out, however, that the metric is better at showing an overbought market than at identifying oversold conditions.
In other news, as one analyst noted in a twitter.com/jvs_btc/status/1774792445584191937″ target=”_blank” rel=”nofollow”>mail On x, all bitcoin investor groups have accumulated a net amount of 95,000 btc ($6.5 billion at current exchange rates) over the last month.
<img loading="lazy" decoding="async" class="alignnone aligncenter" src="https://technicalterrence.com/wp-content/uploads/2024/04/Start-selling-Bitcoin-when-this-happens-says-this-Quant.jpeg" alt="bitcoin accumulation” width=”828″ height=”489″/>
The trend in the monthly balance change for all btc cohorts | Source: twitter.com/jvs_btc/status/1774549712667816179" target="_blank" rel="nofollow">@jvs_btc on x
This rapid accumulation suggests that bitcoin investment groups have been buying much more than miners have produced. The chart shows that a run of accumulation of similar levels followed the asset's recent rally, so the latter may also be bullish for the asset.
btc Price
At the time of writing, bitcoin is trading at around $68,600, up more than 3% over the past week.
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Looks like the price of the coin has registered a sharp drop in the past 24 hours | Source: BTCUSD on TradingView
Featured image from iStock.com, Glassnode.com, CryptoQuant.com, TradingView.com chart
Disclaimer: The article is provided for educational purposes only. It does not represent NewsBTC's views on whether to buy, sell or hold investments, and investing naturally carries risks. It is recommended that you conduct your own research before making any investment decisions. Use the information provided on this website at your own risk.
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