After a brief attempt to cross $72,000 earlier this week, the Bitcoin price has continued to face some selling pressure. As of press time, the Bitcoin (BTC) price is trading 2.69% down at a price of $67,536 with a market cap of $1.331 billion. If BTC fails to hold the $67,000 support, it can further drop to $64,000.
Bitcoin Puell Multiple Flashes Buy Signal
According to analysis from CryptoQuant, the decline in the Puell Multiple following a Bitcoin halving event holds significant implications for the market.
Bitcoin undergoes a halving roughly every four years, resulting in a halving of the mining reward per block, directly impacting miners’ earnings. Consequently, miners experience a substantial decrease in daily revenue unless Bitcoin’s price sees a significant surge to offset this reduction.
The Puell Multiple, which measures the ratio between daily revenue and the 365-day moving average, witnesses a sharp decline post-halving. This is due to the lag in the adjustment of the long-term moving average to the new mining reward reality.
This reduction in miners’ daily revenue signifies a less profitable mining environment unless Bitcoin’s price sees a notable uptick. The current Puell Multiple range indicates a price discount, suggesting that the network may be undervalued, reports CryptoQuant.
Moreover, the decrease in the supply of new Bitcoins could potentially drive prices upward, particularly if demand continues to rise. Investors may interpret the Puell Multiple’s decline as a signal that the market is adapting to a new phase of scarcity, potentially setting the stage for a market rally.
Consequently, this phenomenon could signify a period of adjustment in the mining sector, impacting Bitcoin’s supply and demand dynamics and potentially foreshadowing significant price movements in the future.
BTC Price Consolidation
Although the BTC price rallied to $72,000 earlier this week, we’re still not out of the Bitcoin consolidation phase as reported earlier this week. As per the historical trends and post-halving behavior of Bitcoin, it would still take a few more weeks for Bitcoin to give a fresh breakout and enter the price discovery zone.
Once this happens, the BTC price will be all set to rally to $100,000 by the end of this year.
The post Bitcoin Puell Multiple Is Currently In Discount Range, BTC Price Rally to Begin Soon? appeared first on CoinGape.
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