A new analysis from a CryptoQuant contributor shows that the Puell Multiple, a key Bitcoin on-chain indicator, is getting close to a level that may mean investors should buy.
Traders often use the Puell Multiple to see how many miner coins are being sold. Right now, it’s moving back and forth between two important levels, which could be a sign that Bitcoin is about to go up in value.
The index finds the ratio of the daily amount of Bitcoin issued (in USD) to its 365-day moving average. This shows how profitable Bitcoin mining is.
CryptoQuant writer Grizzly wrote in an August 31 analyst note that the index is currently stuck in the “Decision Zone,” which on the Puell Multiple is a range between 0.6 and 0.8. In the past, when the index fell below the 0.6 level, it usually meant that investors using dollar-cost averaging (DCA) methods should start buying Bitcoin.
“The Puell Multiple index is going back and forth between these two important levels.” Grizzly said, “If past trends hold true, a bearish scenario in which the index falls below 0.6 could once again mean a good time for investors to buy.”
Bitcoin’s Puell Multiple At 0.69 Sparks Trader Interest
It says that the Puell Multiple is 0.69 on Bitbo at the time of writing. This level is getting a lot of attention from traders because it could mean that miners have to sell more. When Bitcoin hit its all-time high of $73,679 on March 13, 2021, for example, the Puell Multiple was 1.88. That is, there wasn’t a big reason to buy at that time.
CoinMarketCap says the price of Bitcoin right now is $58,416, which is 8.98% less than it was seven days ago. Many analysts and traders are talking about the recent drop as a possible short-term chance to buy.
Moustache, a fake crypto expert with 133,100 followers on X (formerly Twitter), said he was sure that the current Puell Multiple reading meant one of the best times to buy in over two years. “This is your second best chance after 2022 to get back on top before the next wave starts,” Moustache said.
Many people who want to buy Bitcoin still don’t know how long this range will last. A fake crypto trader called Rekt Capital said that Bitcoin could break out of its reaccumulation range as early as the end of September. However, it is more likely that BTC will stay in its range until October, when it could break out.
