Bitcoin price rallied 1,550% the last time the ‘BTC risk-off’ metric fell this low
Key Takeaways:The Bitcoin Risk-Off signal dropped to 23.7, its lowest since March 2019, indicating low correction risk and a high likelihood of a bullish trend developing.Despite the recent decline in network activity, bullish macro indicators like the Macro Chain Index (MCI) suggest Bitcoin could soon rally above $100,000.On May 5, the Bitcoin Risk-Off signal, an indicator that uses onchain and exchange data to assess correction risk, dropped to its lowest level (23.7) for the first time since March 27, 2019, when Bitcoin (BTC) traded at $4,000. The signal is currently in the blue zone, which historically suggests low correction risk and a high probability of a bullish trend. When the oscillator rises above 60 or turns red, it implies a high risk of bearish movement. Bitcoin Risk-Off signal indicator. Source: CryptoQuantIn 2019, the same signal preceded a staggering 1,550% rally that saw Bitcoin soar above $68,000 in 2021. Data from CryptoQuant indicates that the Risk-Off signal combines six metrics: downside and upside volatility, exchange inflows, funding rates, futures open interest, and market capitalization. Collectively, they provide a balanced view of correction risk, making the signal a data-oriented gauge for market trends. The last time the Risk-Off Signal indicated a low-risk investment environment, Bitcoin was valued at $4,000. Several factors can explain the price disparity. The launch of spot Bitcoin exchange-traded funds (ETFs) in the US in 2024 opened the floodgates to institutional capital, boosting demand and stabilizing prices. In fact, ETFs and public companies now hold 9% of the Bitcoin supply.
Key Takeaways:
The Bitcoin Risk-Off signal dropped to 23.7, its lowest since March 2019, indicating low correction risk and a high likelihood of a bullish trend developing.
Despite the recent decline in network activity, bullish macro indicators like the Macro Chain Index (MCI) suggest Bitcoin could soon rally above $100,000.
On May 5, the Bitcoin Risk-Off signal, an indicator that uses onchain and exchange data to assess correction risk, dropped to its lowest level (23.7) for the first time since March 27, 2019, when Bitcoin (BTC) traded at $4,000. The signal is currently in the blue zone, which historically suggests low correction risk and a high probability of a bullish trend. When the oscillator rises above 60 or turns red, it implies a high risk of bearish movement.
In 2019, the same signal preceded a staggering 1,550% rally that saw Bitcoin soar above $68,000 in 2021.
Data from CryptoQuant indicates that the Risk-Off signal combines six metrics: downside and upside volatility, exchange inflows, funding rates, futures open interest, and market capitalization. Collectively, they provide a balanced view of correction risk, making the signal a data-oriented gauge for market trends.
The last time the Risk-Off Signal indicated a low-risk investment environment, Bitcoin was valued at $4,000. Several factors can explain the price disparity.
The launch of spot Bitcoin exchange-traded funds (ETFs) in the US in 2024 opened the floodgates to institutional capital, boosting demand and stabilizing prices. In fact, ETFs and public companies now hold 9% of the Bitcoin supply.
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