On-chain data shows the Bitcoin puell multiple has started to leave the “buy” zone, a sign that the crypto may be heading towards bullish momentum.
What this metric’s value tells is how much Bitcoin miners are currently making compared to the average for the past year.
When the value of the indicator rises, it means miner revenues are going up right now. This leads to miners becoming more likely to sell and the price may be called “overvalued.”
On the other hand, decreasing values of the metric can suggest the price is becoming more undervalued as miner revenues are moving down.
Now, here is a chart that shows the trend in the Bitcoin puell multiple over the last several years:
As you can see in the above graph, the Bitcoin puell multiple was in the “buy” zone until just a little while ago.
There is also an opposite area, the “sell” zone, which represents values of the multiple greater than 4. Naturally, BTC is overvalued in this region.
Very recently, the puell multiple has seen some uplift and has now just broken out of the green zone. During the past, this has usually been a sign that the crypto is now heading towards bullish momentum.
One thing should be noted, however, that in the past a breakout from the region doesn’t mean a rally would necessarily begin immediately. There could still be a few more months of buildup before a proper run can begin.
The below chart shows the trend in the price of the coin over the last five days.
After holding above $22k for about a week, Bitcoin seems to have dipped below the level over the past 24 hours.