Here Are 4 Indicators Showing Bitcoin Is Nowhere Near Top, According to Crypto Trader Lark Davis

Crypto trader and influencer Lark Davis says a number of indicators are signaling that the end of the Bitcoin rally is still nowhere in sight, despite the recent correction.

In a new video, Davis names four well-known indicators to show that the world’s largest crypto asset by market cap still has gas in the tank.

The first indicator that the trader brings up is the Bitcoin Heat Map, which uses colors to represent the percentage of increase of the 200-week moving average (MA) on a month-to-month basis. The spots turning red, which it hasn’t done yet, is supposed to be a signal of an overheated market.

“We do not have any red dots currently. In fact, we don’t even have any orange dots currently… [We’re] potentially still 4, 5, 6 months away from a real blowoff top for the cryptocurrency markets. Obviously, this is just Bitcoin we’re looking at but Bitcoin does lead the markets so if Bitcoin gets up to let’s say $150,00, $250,00 during this market cycle, well then we’ll get our red dot coming in. But we’re not there yet, so just keep that in perspective.”

The next metric that Davis points out is the Puell Multiple, which examines the revenue of Bitcoin miners in relation to the price of BTC. Miners are known to be compulsory sellers due to their need to cover fixed costs. This indicator still hasn’t entered the overbought zone, from Davis’ point of view.

“This is not showing that there is a market blowoff top happening right now. What it’s actually more reminiscent of if you ask me is actually probably something like… July, August or September of the 2017 bull run. For comparison, that’s where we might be at the moment because we are seeing these big dips, these big corrections. We have not yet gotten into this area (red rectangle) that shows we are in an overbought market.”

Davis also takes a look at the 2-year MA multiplier, a long-term focused indicator that uses a two-year moving average and another line that represents the 2-year MA multiplied by five.

The popular YouTuber notes that each time a Bitcoin bull rally ended, BTC first shot up past the red line. From his perspective, Davis says that the current price action of Bitcoin resembles mid-2017 when it began to nudge the red line for months before rocketing upward for a final blowoff.

In addition, the analyst notes that the Bitcoin Rainbow price chart, a logarithmic growth scale, is signaling that BTC only recently hit the halfway point, and still has a ways to go before it loses steam.

“You can see in the previous market cycles we did get up to the ‘Is this a bubble?’ territory or even above in some situations. 2017 hit it very very nicely heading up to around $20,000. We are not there yet.”

Looking at the four indicators, Davis highlights that he doesn’t believe the bull market has hit its apex.

“People out there packing saying that the top is in.. They’re not actually looking at the bigger picture here, looking at the indicators. understanding what’s going on. Look, I could be wrong about anything and everything that I say… But I look at the indicators, I look at the sentiment in the market and all these different things, and I don’t feel like this is the top of the bull run.” 

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The post Here Are 4 Indicators Showing Bitcoin Is Nowhere Near Top, According to Crypto Trader Lark Davis appeared first on The Daily Hodl.