Key Takeways
- Most probable bottom zone, Cumulative Value-Days Destroyed (CVDD), and realized prices show $46,000 to $54,000
- On the upside, the STH cost standard, and other factors, are shown to be between $75,000 and $79,000
Two-Layer Structure of Polar Zones and Opposite Scenarios
On June 5, the bottom zones of Bitcoin (BTC) were analyzed using Glassnode’s on-chain data by the company’s co-founder, Rafael (X:@n3ocortex). Rafael presented probabilistic examples drawn from multiple market indicators. At the time of the posting of this article, BTC is priced at about $62,000, a decrease of roughly 50% from its all-time high (ATH).
Rafael began his post by saying, “The bottom cannot be identified in advance; it can only be framed by zones, probabilities, and levels indicating changes in the situation,” after which the co-founder presented a staggered downward support. On June 6 the following day, he posted, “This is not a prediction.”
The segment formed by the Cumulative Value-Days Destroyed (CVDD), about $46,000, is the downside zone Rafael is most concerned with, with the realized price at about $54,000. It is a band where on-chain indicators that have continuously functioned in market cycles meet. The co-founder considers it a “zone with a higher probability bottom.”
The price of BTC currently (around $62,000) is set above this level, trading around the central realized price (about $64,100) and the 200-week moving average (200 WMA), at about $61,700.
The ‘sell phase’ between $35,000 and $40,000 is below that and continues indicated by balanced and delta prices. Trading days that have achieved this level are limited to less than 3% of the historical total, according to Rafael, defining it as an extreme scenario.
The co-founder noted that past major bottoms have marked declines of 85%, 84%, and 77% from their highs, mentioning the maximum rate of decline per cycle.
Fifty percent (50%) of the high is the decline rate for this cycle, Rafael added that, “Market maturity does not rule out deeper sell-offs, but a high-probability bottom suggests it is near the upper zone.”
The First Challenge for Recovery and Initial Resistance
The $75,000 to $79,000 range on the upside is indicated as the first important upward target. Concentrated at this band are the cost criteria for short-term holders (STH), the True Market Mean, and the 200-day moving average (200DMA). Rafael said whether upward movement can be made as support would be the “first sign of recovery.”
Also, insistence at the 50-week moving average (50WMA) looks to be moving upward, which Rafael points out as a greater impediment for determining a full-fledged movement recovery.
None of these levels have yet to be returned to and are currently in the stage of being labeled as probabilistic zones, according to market analysts.
