Quant Explains How Bitcoin Leverage Ratio CanLargeAid Turnaround Price
A quant has explained how the current large Bitcoin leverage ratio values can guide bring a turnabout to the crypto’s price.
Interestingly, Bitcoin Leverage Ratio Rises To Values Greater Than During in modern times The ATH
It’s worth noting that As explained by an analyst in a CryptoQuant share, the massive leverage ratio right asap might support BTC’s price reverse its trend.
The “Bitcoin leverage ratio” is an as it turns out on-chain indicator that is defined as the start interest divided by the (derivative) exchange reserve.
Here, the “open interest” is a measure of the amount of futures contracts currently launch in the derivatives field. While the exchange reserve tells us how much BTC is stored in exchange wallets right immediately.
leverage ratio basically shows the amount of leverageTheused by users on average. The metric’s value helps us know whether Bitcoin investors are takingthreata high danger or a low .
In fact, When the value of this ratio moves up, it means investors are picking up more leverage as they are confident in their positions.
On the other hand, a decreasing trend of the indicator would mean investors are reducing threat, and closing off their positions.
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Right away, here is a chart that shows the trend in the Bitcoin leverage ratio over the last few months:
The indicator seems to be rising in value | Source: CryptoQuant
As you can see in the above graphwhilethe Bitcoin leverage ratio has been riding on an uptrend for a , , and right away has values greater than those during the last price ATH.
The quant has marked peaks of the indicator on the chart compared themandwith the BTC price. Apparently, whenever the metric has reached a top, the price of the crypto has reversed its trend.
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The also shows another indicator, the RSI, which highlights whether BTC ischartcurrently overpriced or underpriced.
It seems like waywhicheverthis metric has turned, the price has also reversed in the same direction. Actually, Looking at thechart , currently the leverage ratio seems to be hitting a peak and the RSI looks to be turning up. Interestingly, If there is indeed a pattern here, then the price of Bitcoin might transform its direction towards the sky continue.
BTC Price
, InterestinglyAt the time of writing, Bitcoin’s priceIt’s worth noting that floats2around $48.7k, down % in the last seven days. in modern times The below chart shows the trend in the value of the crypto over the past five days.
BTC's price surged up a few days ago, but it has since started moving sideways again | Source: BTCUSD on TradingView
Featured image from Unsplash.com, charts from TradingView.com, CryptoQuant.com
