Bitcoin's Rare Bullish Signal Flashes Again Ahead of Potential Bottom
A rare technical signal in Bitcoin's history has flashed once again, sparking hopes that it may be a sign of a near-term bottom for the cryptocurrency.
The signal is known as Willy Woo's monthly Fisher Transform, which measures the potential for price reversals. This metric has only occurred four times since 2011, and in each case, it preceded a bear-market bottom.
According to Woo, 'BTC bottoms: 3 for 3 without fake-out,' suggesting that this signal is reliable. However, he also noted that a turning point on the Fisher Transform doesn't automatically mean the trend is ready to reverse, as price can continue in the same direction before eventually reversing.
Glassnode reported that Bitcoin's entity-adjusted Spent Output Profit Ratio (SOPR) has moved back above 1, indicating that coins are being sold at an average profit. This metric is considered a 'hallmark of a bull market,' but a drop below 1 could signal weak demand.
PlanB, another analyst, pointed out that Bitcoin's next resistance level sits near $89,000, based on its longer-term moving averages.