3 roads lie ahead for Bitcoin – Which one will BTC choose?

• Bitcoin’s momentum ratio outlined three potential situations for BTC’s subsequent leg.
• Given {that a} correction has already occurred, a deeper pullback is much less possible.

Bitcoin [BTC] began Might off with bullish momentum, closing at $97,406. 

This breakout above a essential resistance degree strengthens the bull case, particularly given BTC’s earlier incapacity to maintain above this threshold since late February.

Nevertheless, the transfer additionally introduces bearish implications. Bitcoin’s worth now sits above the Short-Term Holder (STH) realized price.

On the twenty second of April, this shift pushed 155-day-old BTC from an underwater place to an unrealized revenue state. 

The STH realized worth, now at $93,342, represents the common on-chain value foundation for these holders, establishing a big help ground for Bitcoin.

So, whereas a brand new all-time excessive seems inside hanging distance, anticipating a clean, uninterrupted ascent would nonetheless be untimely.

Three situations that might form Bitcoin’s subsequent rally

Constructing on Bitcoin’s momentum ratio, famend crypto analyst Axel Adler highlighted three key scenarios for BTC’s subsequent transfer after breaking the essential $97k overhead provide barrier.

At press time, BTC’s on-chain momentum sits within the “begin” rally zone, with the momentum ratio at roughly 0.8 (80%). 

This implies the market is positioned for potential upside, however the route will depend upon how the ratio behaves within the coming weeks.

Supply: CryptoQuant

If the momentum ratio breaks above 1.0 and maintains that degree, key metrics like NUPL and MVRV would sign a recent upward impulse, doubtlessly pushing Bitcoin’s worth into the $150k–$175k vary. 

Conversely, if the momentum ratio dips to 0.75 or decrease, STHs would begin cashing out, resulting in a possible correction to the $70k–$85k vary.

Within the third situation, if the ratio holds within the 0.8-1.0 vary, BTC will possible keep in a large buying and selling vary between $90k and $110k.

On this situation, market individuals would maintain their positions, however vital new publicity or shopping for stress wouldn’t materialize.

BTC’s most probably subsequent transfer

Within the bullish situation, if Bitcoin’s momentum ratio climbs above 1.0 and sustains, we might see a rally towards the $150k–$175k vary, echoing earlier macro cycles. 

In 2017, Bitcoin surged almost 20x, whereas in 2021, it tripled after breaking prior highs – each cycles marked by NUPL and MVRV ratios getting into euphoric zones. 

At press time, the MVRV sat at 2.16 — properly under the three.9 threshold traditionally seen close to market tops. Therefore, there’s nonetheless headroom earlier than reaching overvaluation.

This suggests that the present market just isn’t but in a euphoric part.

Supply: Glassnode

Equally, NUPL was holding at 0.54, indicating early-stage optimism. If NUPL pushes towards the 0.74 vary, it might align with previous bull market peaks, suggesting room for additional upside. 

Supply: Glassnode

Nevertheless, if sustained shopping for stress fails to emerge, a base-case situation of consolidation between $90k–$110k turns into extra possible, particularly with resistance-driven corrections. 

That stated, given a correction has already performed out just lately, the bullish and consolidation situations carry extra weight than a deeper pullback.

Control these indicators, as they maintain the important thing to Bitcoin’s subsequent transfer.