In the bitcoin market, the biggest question any investor cares about is “When should I invest?” And this is a fair question, especially since profitability is the only driving factor for an investor.
Well, it looks like the opportunity has reappeared as Bitcoin is at its highest profitability in recent memory. Here’s how to bet on it –
Bitcoin is profitable
Based on the strong market rally in the past 6 weeks and the strong crash that followed, there is some concern as to whether the market is overheating or not.
An overheated market is a fast growing market that is becoming unstable. However, if you look at the BTC market right now, it seems that this is not the case. In fact, this is the best time to jump as the buying opportunity is pretty lucrative at this point.
Traditionally, the 200-day moving average (DMA) is considered the standard buy and sell indicator. If the BTC price is above it, it is usually the start of a strong upward movement. On the contrary, movement in the opposite direction is usually a sign of a fall.
Right now, Bitcoin’s price movement is in line with the 200 DMA – a clear sign that the market is not overheated.
In fact, another buy signal comes from the Mayer multiplier. The indicator’s low values at the time of publication seemed to suggest that Bitcoin is cheap compared to long-term trends. It is understood that the present is a good time to shop.
At the time of writing the above metric, having below 1 was a good enough signal.
However, in order to understand the state of the market for investment, it is necessary to check the total value of the market, whether it is in a state of profit or loss.
How is the market doing?
To test the state of profitability, we can use the MVRV ratio, whose historical highs after the halving highlight the signs of a bull market. Consequently, market signs did not seem particularly indicative of a bullish move.
Still, given the print time, the MVRV value of 2.2 could be the start of the unit. Values of 2.0-5.0 represent profitable profits that can be expected over the course of the month. This is the perfect place to invest and you can expect profit within a month.
Anything above 5.0 is not good, however, as they indicate fixes coming in over the course of the month. But the market is still far from this. In fact, MVRV hasn’t come close to 5 in over 7 years.
Finally, it is equally important to understand market sentiment. Thus, it is possible to determine in which direction the market is actually moving.
At the time of publication, the Fear and Greed Index was the lowest in 50 days at 30.0 (fear). Consolidation or retracement of the price could bring it back into the neutral zone. This will again be a good sign for investors looking to make a profit.
Overall, the market is healthy with the aforementioned indicators flashing buy signals as profitability is coming soon.