Bitcoin (BTC) and volatility go arm in arm. Volatility translates to asset prices changing unpredictably and rapidly, especially to the worst. Bitcoin has struggled within the last few months, following two-year highs. However, traders can use on-chain metrics to navigate the cryptocurrency winter.
From Here to There
Though the bearishness, Bitcoin appears to overcome the trading channel at $17K – $24K, changing hands slightly beneath $25K (Coinmarketcap data). Nevertheless, the bellwether crypto has lost approximately 16% since 2022 started.
Meanwhile, cryptocurrency’s cycles gradually became sharp as loss bottoms & profit tops failed to adhere to a horizontal line (CryptoQuant analysis). The analyst used the NUPL (Net Unrealized Profit & Loss) metric as a reference for more clarity.
Herein, the metric’s value has hiked and switched positive. The graph revealed the logical trend levels of the BTC NUPL indicator. Also, the NUPL cycles gradually lost volatility as the index failed to overcome the greed mark at 0.75 like in previous cycles.
Also, the previous two bottoms saw loss amounts. The NUPL value declined sharply a while ago, dipping into negative before rebounding into a positive region within no time, after printing a possible bottom. Nevertheless, this low remained far from the 0.4 conventional mark.
Any Shocks?
Furthermore, risks of escalated decline appear to ease amid subsided macroeconomic pressures. The analytic platform Glassnode tweeted about similar tales. It added that BTC’s demand remains down as alts steal the show.
However, that does not imply prices could not resurface beyond the shoreline. Evaluating the weighted funding rate shows near-term holders congested the platform, translating to potential rebounds.
Meanwhile, the $25K hurdle seems challenging for Bitcoin. The bellwether coin could not overtake the price levels following brief breaches. Bulls should ramp up volumes to support stable upsides in the leading cryptocurrency. Nevertheless, BTC might slide before accumulating massive potential to conquer the mentioned obstacle.
Also, the global cryptocurrency market capitalization noted gradual declines over the previous day, hovering around $1.15 trillion during this publication. It remains fascinating to watch upcoming price reactions in the cryptocurrency world.
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