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This Important BTC Metric Has Turned Bullish Again — TradingView News
A crucial Bitcoin metric just turned bullish, sparking optimism from one crypto analyst about an impending rally for Bitcoin. This unique technical pattern suggests that the world’s largest cryptocurrency could see its price rise further, potentially kicking off a much-welcomed bull run this cycle.
Bitcoin’s technical pattern turns bullish
The price of Bitcoin has often followed distinct historical patterns, with most of these indicators preceding significant rallies or bearish trends. One of the most compelling signals that Bitcoin may turn bullish again is seen as the Stablecoin Supply Ratio (SSR) oscillator falling below the lower Bollinger Bands, a technical indicator used to measure a market’s volatility and momentum .
According to a crypto analyst identified as “Dominating Crypto” on X (formerly Twitter), the SSR is a unique technical tool designed to gauge market sentiment by comparing the supply of stablecoins to Bitcoin. This tool is used by analysts and traders to identify buying and selling opportunities for Bitcoin. It also quantifies how the SSR’s 200-day simple moving average (SMA) moves within the Bollinger bands.
Dominando Cripto provided an in-depth explanation on how the SSR oscillator is calculated and how to interpret its signals to identify bullish trends.
“The oscillator is calculated by taking the difference between the current value of the Stablecoin Supply Ratio and its 200-day simple moving average (SMA), then dividing it by the standard deviation of the SSR over the same period,” the analyst said.
Sharing a price chart depicting the movements of the SSR oscillator, the crypto analyst suggests that when the oscillator moves above the upper Bollinger bands, this suggests that the SSR is significantly higher than normal levels. This indicates that stablecoins are dominating the market, signaling bearish sentiment and a potential downturn for Bitcoin.
Conversely, when the oscillator drops below the lower Bollinger band, it indicates that the SSR is low, highlighting the reduced dominance of stablecoins and signaling bullish sentiment that could potentially trigger an imminent rally in Bitcoin.
In the price chart above, Dominando Crypto identified several instances where the SSR oscillator exhibited bearish and bullish sentiment, identifying these periods as hot zones and cold zones respectively. Recent market movements indicate that the SSR oscillator is in the cold zone, indicating a potential bullish outlook for Bitcoin.
More bullish signs for BTC
On May 18, Blockchain analytics platform, Santiment, revealed a new market trend in which small traders are constantly liquidating their BTC holdings, even though the cryptocurrency has shown positive performance lately.
The analytics platform noted that historically, when small wallets dump coins into larger wallets, it is considered an encouraging sign for Bitcoin, indicating a potential bullish trend reversal for the pioneer cryptocurrency.
At the time of writing, Bitcoin’s price is trading at $66,955, according to CoinMarketCap. The cryptocurrency has seen strong bullish momentum recently, rising 8.94% over the past seven days and rising 4.25% over the past month.