BTC price high as metric signals Bitcoin RSI for short term profit
Bitcoin (BTC) may be seeing the final innings of a macro bull run, a historically accurate on-chain gauge says.
The Value Days Defective (VDD) multiple, which predicts previous BTC price increases, has hit an “occasional” high.
VDD several hits “occasionally” high
Bitcoin has yet to break new all-time highs or the previous highs before 2021 into solid support.
Some are confident that BTC's price gains will come back, but those analyzing signals on the chain are worried.
Among them is TXMC commentator, host of YouTube channel Alpha Beta Soup.
Uploading a bunch of new VDD data to X this week, TXMC revealed that the chart is just ahead of its published highs putting the BTC/USD macro on top.
“The rare 4.0 publication,” he wrote in an accompanying review.
“Has the speed on the chain increased?”
The market psychology of the VDD Multiple compares the cost on the chain to historical averages to determine when a significant drop in price will occur. The “Damaged Value Days” section corresponds to the number of days that the coins were previously used on-chain.
In March, the VDD multiplier was around 3.5, which TXMC already described as “overheating”.
“It's not perfect, but it's not unremarkable,” he wrote.
This year, however, includes a key difference from early 2021. During the last increase in the VDD multiplier, BTC/USD doubled its previous all-time high of $20,000.
“We are printing the same price in 2024,” TXMC added, concluding that the overall picture was “uncertain.”
RSI is waiting for key support after the washout.
As Cointelegraph recently reported, other chart metrics are giving traders cautious optimism.
Related: Plotting Your Way to $80K — 5 Things to Know in Bitcoin This Week
Among them are classic indicators such as the Relative Strength Index (RSI), which recently saw a “reset” to levels seen at the end of January.
The daily RSI stopped at 53 on April 10, according to data from Cointelegraph Markets Pro and TradingView – still far below the traditional “overbought” zone, it starts at 70 and tends to accompany the downward part of the BTC price cycle.
“In a strong bullish trend, it's time for Bitcoin's daily RSI to retest ±50. It is trying ±50 now,” noted trader Jelle said on the day.
Prominent trader Alan Tardigrade reiterated promising signs on the 4-hour RSI time frames with a hidden bullish divergence with price.
“A hidden bullish divergence is happening here where $BTC is making a higher low (HL) while the RSI is making a lower low (LL). This shows that the bullish trend is continuing,” he told X Followers with Charts.
Monthly timeframes continue to hold above 70, a feature that preceded the halving of Bitcoin's earnings block subsidy by the controversial analyst's Plan B and others.
This article does not contain investment advice or recommendations. Every investment and business activity involves risk, and readers should do their own research when making a decision.
