While Bitcoin has been unable to break past the $70,000 price mark for over 2 months now, the asset has made efforts to remain above the $60,000 mark.
Amid this maintenance above the $60,000 price level, analysts have continued to speculate on BTC’s future trajectory especially when the asset would make the play out of the long-anticipated rally to a major highs.
One such analyst, CryptoBullet on X, has brought attention to a particular indicator— the Puell Multiple— suggesting that Bitcoin may be on the cusp of reaching a new all-time high (ATH).
Understanding The Puell Multiple
According to CryptoBullet, the behavior of the Puell Multiple indicator often correlates with Bitcoin’s market cycles, potentially offering a clue into where the asset is headed next.
The Puell Multiple, calculated by dividing the daily issuance of Bitcoin in USD by the 365-day moving average of the daily issuance, is used as a measure to understand the miners’ profitability and their potential influence on Bitcoin’s price.
Historically, when the Puell Multiple entered its “Green Zone,” it indicated that Bitcoin may have reached a market bottom, which often preludes a significant upward trend. CryptoBullet points out that this phase of the cycle often sees Bitcoin bottoming out before starting its ascent toward a new ATH.
#BTC Puell Multiple indicator
💡 This is why I think $BTC is not done yet and we’ll get a new ATH soon
According to this chart, #Bitcoin Bear Markets end (#BTC finds the bottom) when Puell Multiple reaches the Green Zone
Then Puell Multiple bounces as $BTC price prints the… pic.twitter.com/pL1ShFxcwE
— CryptoBullet (@CryptoBullet1) October 6, 2024
Bitcoin Puell Multiple Hints At Potential New All-Time High
CryptoBullet’s analysis shows how the Puell Multiple has behaved across different market cycles. Specifically, he noted that Bitcoin’s bear markets tend to end when the Puell Multiple hits the Green Zone, when Bitcoin finds a bottom.
Once this bottom is established, the Puell Multiple begins to bounce, indicating the first significant upward leg in Bitcoin’s price movement. The significance of the Puell Multiple, according to CryptoBullet, lies in its pattern of “higher lows” and “higher highs.”
After reaching the Green Zone, Bitcoin’s price often experiences a mid-term correction that corresponds with the Puell Multiple creating a higher low. From this point, both the price of Bitcoin and the Puell Multiple tend to rally upwards, often reaching new highs.
Currently, CryptoBullet believes that Bitcoin is in the early stages of its next significant leg up. The higher lows and a potential for higher highs in the Puell Multiple may signal that both Bitcoin’s price and its market momentum are aligning for another rally.
In the context of Bitcoin’s current trajectory, this suggests that a potential breakout to a new ATH could be imminent.
Featured image created with DALL-E, Chart from TradingView