As if torn apart, so won: after a turbulent weekend, green candles are printed again at the crypto market. Do the cops take over the scepter again?
The crypto market recovered quickly from the massive weekend sales. The total market capitalization increases 8.1 percentage points compared to the previous day and thus rises again just above the mark of 2 trillion US dollars. The Bitcoin price starts the new week with a daily increase of 6.7 percent also under good omens. In today’s, still young course of trade alone, the crypto lead currency has already made 5,000 US dollars good. At the close of trading, the BTC price was quoted at 52,717 US dollars.
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The Altcoins also make up for their losses. With the exception of Dogecoin, the entire top ten is clearly on the rise. With Ethereum (ETH), Binance Coin (BNB), XRP, Polkadot (DOT) and Uniswap (UNI), five coins recorded price increases in the double-digit percentage range. But the developments of Cardano (ADA) and litecoin (LTC) can also be seen with 9.6 and 8.7 percent.
While follow-up purchases ensure price gains on a broad front, entrepreneur and Bitcoin entrepeneur Anthony Pompliano lets the mini-crash Review and provides an assessment of the medium-term market performance.
Long liquidations trigger sell-offs
The cause of the crash was therefore unequal distributions on the futures markets. According to Pompliano, one of the largest “long liquidations in history”took place at the weekend. In total, long positions have been liquidated for 1.8 billion, more than a year ago, when the Bitcoin price collapsed by 50 percent on “Black Thursday”. The plunge caused by the long squeeze has triggered a wave of panic selling that has pushed the BTC price back below $ 50,000 at a record pace.
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According to Pompliano, however, the Spent Output Profit Ratio (SOPR) indicates that “the bottom of this correction has been reached”. The SOPR indicator measures gains and losses based on entry to a certain price level. As can be seen in the chart below, the metric has approached a value of 1 during the sell-off, “indicating that participants are neither in profit nor in loss”. However, this is a good sign, because:
Each dive below 1 was historically a good buying opportunity. In the January correction, the SOPR was reset to just above 1, and in the February correction, a full reset was made below 1. Currently, the SOPR is approaching the mark for the full reset, which means that the price has either reached the bottom of the current correction or is close to it.
Bitcoin correction already overcome?
The Bitcoin price receives a tailwind from the miners. While crypto-miners continued to exert pressure on sales until April, Glassnode’s “Miner Net Position Change” indicates that they are accumulating their holdings again. This shows, on the one hand, that miners are lurking for higher prices. In addition, the Hodl trend shows that you can cover your operating costs without having to throw large amounts of Bitcoin onto the market.
The superordinate also has a rapid network growth, which sheds a bullish spotlight on the performance of the coming months. Over 50,000 new entities are added to the blockchain on average every day. A good sign: the Bitcoin price finally rises with his adoption.
In view of these developments, Pompliano is optimistic about the coming weeks. Bitcoin has gradually reached the bottom of the correction. Now it is only to wait until ” the profit taking is reset and a general shift of the coins from weak to strong hands takes place”. A time frame could not be foreseen. But”when this period of consolidation is over, there is a lot of room for price to move up.”