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Accumulation Through Aggressive DCA in These Zones Can Bring High Potential Returns in the Next 6 Months/1 year.
Profit/Loss on current #Bitcoin supply is back in bottom accumulation zone 🔥
"Accumulation through aggressive DCA in these zones can bring high potential returns in the next 6 months / 1 year."
by @caueconomyRead More👇https://t.co/biUFgm4Df1 pic.twitter.com/wwxYfdATFE
— CryptoQuant.com (@cryptoquant_com) August 31, 2022
Bitcoin (BTC) is currently witnessing extensive underperformance, with several metrics reaching bottom levels. Nonetheless, most of these metrics also provide a silver lining: an attractive accumulation zone for BTC. The BTC ratio of supply in profit, in particular, signals a strong point of accumulation that could lead to proper returns.
Per details by crypto data analytics platform CryptoQuant, most BTC holders are currently at a loss. The chart which indicates the percentage of supply in profit or loss has fallen to a value of 50.9. According to a CryptoQuant analyst, this indicates that most market participants are at a loss.
In addition, the analyst also highlighted that this metric provides a strong indication of market bottoms. “With high net losses, the sales force is gradually being exhausted, offering an opportunity for bulls to guide reversals,” the analyst said. However, he added that an exhaustion of the sales force could take months, indicating that investors should expect a reversal in the long term.
In conclusion, he noted that investors should grab the opportunity by accumulating BTC through dollar-cost averaging (DCA). The analyst says that gradually buying Bitcoin on every dip from $20,000 downwards could yield high returns. According to him, this technique could produce some heightened returns in the next six months to 1 year.Â
Dollar-cost averaging involves the periodic investments of an investor’s funds in an asset to hedge against price fluctuations. The investor systematically invests his fund’s bit by bit instead of all at once.
Additionally, the Net Unrealized Profit and Loss (NUPL) indicator shows that most BTC holders are witnessing unrealized losses. The NUPL metric has a value of -0.089 – its lowest value in August. This indicates that most BTC investors are at a loss, corroborating data from the BTC Supply in Profit chart.
Bitcoin’s recent price actions represent growing strength amidst a bearish takeover. The asset has shown strong resilience despite crashing below the major support at $20k. BTC quickly bounced back after its fall and has remained above $20k in intraday movements. BTC currently trades at 20,321 against the dollar as of press time, with a slight decline of 0.28% in the past 24 hours.