It may not be the time for bottom fishing
Last week we indicated “The market is having an extreme fear, the price may have a new low”, after the analysis article has been published, bitcoin price slumped from USD 7900 to USD 3800. Our prediction stood as true. There are 56 days left to the third Bitcoin halving, is the current time can allow for the bottom fishing? Let’s take a look at it based on the fundamental indexes.
Daily trading volume — Bitcoin
Bitcoin’s transaction volume had the slump from 350K to 223K, decreased to the level of last year. Bitcoin transaction volume was keeping increase in a slow path since February 2018, it shows the core value of Bitcoin and is the fundamental support for Bitcoin price. The current transaction volume showed the price bottom is yet to come.
Daily trading volume — Ethereum
Ethereum’s trading performance was good, the top was 848K and the newest was 658K.
Daily Hashrate
Bitcoin hashrate also had a huge slump, the top was 119EH/s, the newest was 96EH/s. Computing power (aka mining hashrate) is a key metric as it illustrates the network transaction demand. The current hashrate has not shown a huge number of closing on mining machines.
Active & New Address
The general transaction performance first reached 781K at the top and then decreased to 540K, but the current index still has not shown the bottom is here yet.
Transaction Volume on Bakkt
Last week the total bitcoin’s future option on Bakkt rapidly decreased to USD 46Millions, decreased 11.5% comparing with last week. The maximal open contract volume also had a slump to USD 8.1Millions, decreased 13.8%. This is the lowest active degree during the past months.
USDT Snapshot
With the decrease in Bitcoin price, the premium and the transaction volume of USDT are both increased, this high premium was because of the increasing number of people are selling out their fund to USDT, based on that, the bottom price is not yet coming.
Fear & Greed Index
FGI was 9, was at an extreme Fear sentiment, we only have 1–2 times of such an extreme fear. FGI looks at six different forces to score investor sentiment on a scale of zero to 100 — — extreme fear to extreme greed respectively: marketing volatility (25%) + market momentum (25%) + social media (15%) + market survey (15%) + the ratio of Bitcoin in the market (10%) + Google trend (10%).
Long/Short Ratio
The newest long/short ratio was 0.9, the shorting position finally turned to dominate the longing position. This index indicates the ratio of longing user to the shorting user.
In conclusion
Based on the current level of transaction volume, hashrate and active address, it’s not time to make a bottom fishing. By checking with combing with the international market situation, European and American stock markets are still suffering from the slump, and this slump will keep bring the Bitcoin market a decrease, since people need to sell out their asset to make a complementary, and the apparently BTC is being one of the best choices. In the current step, the thing what we can do is to take a break, protect our money, and preparing for the coming bottom.
