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Analysis

Bitcoin Mayer Multiple returns to July 2021 levels, signaling that $37,000 is a long-term buy

February 22, 2022 - Around 3 mins mins to read

Bitcoin price has fallen so low that one of its most famous indicators is signaling a rare long-term investment opportunity here.

On Feb. 22, the Mayer Multiple is at its lowest level since bitcoin bounced off $29,000 last July.

Mayer Multiple 50% discount for 3 months

The Mayer Multiple, the latest in a series of indicators repeating BTC’s 2021 retracement, is currently at 0.76 and has halved since November’s all-time high of $69,000.

Multiple measures Bitcoin’s current price relative to its 200-day moving average. The indicator’s author, Trace Mayer, believes that any reading below 2.4 leads to increasingly profitable trades for potential investors, and the lower the score, the more effective a long-term buy order is.

Bitcoin

Bitcoin Mayer Multiple Chart | Source: BuyBitcoinWorldwide

Looking at the chart, since 2011 the multiple has been spending most of the time above 0.8 and 87% of the time above the current level.

Therefore, the falling index has attracted a lot of attention. For example, Twitter user Pascal Abams tweeted:

“Coin flow is stationary, compare annual destruction value to 365-day MA. Similar to the Mayer Multiple story, stay low and the price goes up.”

The same thing happened at the November highs: despite the ATH setup price, the multiple only touched the area around its historical average of 1.42, making the $69,000 high no longer the same as previous levels.

Where do deposits go?

Meanwhile, the majority of current investors choose HODL.

The number of people who bought a year ago or earlier is constantly growing, even as prices gradually fall below 2021 levels.

“BTC active supply percentage over the past year just hit a 14-month high of 60.998%.

The previous 14-month high was 60.993% on February 21, 2022.

However, despite retail investor apathy, many commentators say the current setup is up to the market maker.

“After peaking in May last year, taker buy volume (liquidity) gradually decreased. In a year, the expected movement did not occur and liquidity decreased, new deposits continued to decline,” said Mignolet, contributor to on-chain analytics firm CryptoQuant’s Quicktake series Summary On Sunday.

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Annie

Championing positive change through finance, I've dedicated over eight years to sustainability and environmental journalism. My passion lies in uncovering companies that make a real difference in the world and guiding investors towards them. My expertise lies in navigating the world of sustainable investing, analyzing ESG (Environmental, Social, and Governance) criteria, and exploring the exciting field of impact investing. "Invest in a better future," I often say. That's the driving force behind my work at Coincu – to empower readers with knowledge and insights to make investment decisions that create a positive impact.
Analysis

Bitcoin Mayer Multiple returns to July 2021 levels, signaling that $37,000 is a long-term buy

Bitcoin price has fallen so low that one of its most famous indicators is signaling a rare long-term investment opportunity here.

On Feb. 22, the Mayer Multiple is at its lowest level since bitcoin bounced off $29,000 last July.

Mayer Multiple 50% discount for 3 months

The Mayer Multiple, the latest in a series of indicators repeating BTC’s 2021 retracement, is currently at 0.76 and has halved since November’s all-time high of $69,000.

Multiple measures Bitcoin’s current price relative to its 200-day moving average. The indicator’s author, Trace Mayer, believes that any reading below 2.4 leads to increasingly profitable trades for potential investors, and the lower the score, the more effective a long-term buy order is.

Bitcoin

Bitcoin Mayer Multiple Chart | Source: BuyBitcoinWorldwide

Looking at the chart, since 2011 the multiple has been spending most of the time above 0.8 and 87% of the time above the current level.

Therefore, the falling index has attracted a lot of attention. For example, Twitter user Pascal Abams tweeted:

“Coin flow is stationary, compare annual destruction value to 365-day MA. Similar to the Mayer Multiple story, stay low and the price goes up.”

The same thing happened at the November highs: despite the ATH setup price, the multiple only touched the area around its historical average of 1.42, making the $69,000 high no longer the same as previous levels.

Where do deposits go?

Meanwhile, the majority of current investors choose HODL.

The number of people who bought a year ago or earlier is constantly growing, even as prices gradually fall below 2021 levels.

“BTC active supply percentage over the past year just hit a 14-month high of 60.998%.

The previous 14-month high was 60.993% on February 21, 2022.

However, despite retail investor apathy, many commentators say the current setup is up to the market maker.

“After peaking in May last year, taker buy volume (liquidity) gradually decreased. In a year, the expected movement did not occur and liquidity decreased, new deposits continued to decline,” said Mignolet, contributor to on-chain analytics firm CryptoQuant’s Quicktake series Summary On Sunday.

Join CoinCu Telegram to keep track of news: https://t.me/coincunews

Follow CoinCu Youtube Channel | Follow CoinCu Facebook page