Bitcoin
Bitcoin Could Reach Next Top at $89,200, Crypto Analyst Suggests
According to this on-chain indicator, an analyst explained how the next potential local top for Bitcoin could be $89,200.
Bitcoin CVDD “Tops Assessment” Metric Could Hint at Potential Next Top
In a new publish on X, analyst Ali Martinez talked about where BTC’s next top could be based on the Cumulative Value of Days Destroyed (CVDD). CVDD is an on-chain metric derived from “Destroyed coin days”(CDD).
A “coin day” is the amount that 1 BTC accumulates after being inactive on the blockchain for 1 day. When a coin that has accumulated a certain number of coin days is moved on the network, the coin days it was carrying naturally reset to zero and are considered “destroyed.”
CDD measures the number of days worth of coins destroyed on the market on a given day. Since each transaction also carries some dollar value based on the price at the time, CVDD adds another layer of context to CDD, accounting for the dollar value of each coin, breaking dormancy to destroy its coin days.
Unlike CDD, which only tracks the number of days of coin destruction on a given day, CVDD is a cumulative sum of the asset’s history. More formally, CVDD is calculated as a ratio of the cumulative sum of time-value destruction on the network divided by the age of the cryptocurrency.
Analyst Willy Woo developed the original CVDD, which proved to be extremely accurate in locating historic lows in asset prices. In the context of the current topic, however, the “Assessing Tops” modification by the CryptoQuant author Binh Dang is of interest.
This indicator combines the 50-day period moving average (MA) of Bitcoin’s spot price with CVDD and aims to evaluate likely top points of the asset, as its name suggests.
Now, here is a chart that shows what the value of Bitcoin Assessing Tops has been like recently:
From the chart, it is visible that Bitcoin’s spot price briefly surpassed the Valuation Tops in March. When the asset surpasses this indicator, its price usually becomes overheated and prone to forming tops. It appears that this also continued during this recent pause, as the asset soon reached a main following him.
The Bitcoin Assessing Tops indicator currently has a value of $89,200. While a top may not necessarily form if Bitcoin rises to this level, a peak may in fact at least become close when it does, if this indicator passes.
BTC Price
At the time of writing, Bitcoin is trading around $69,300, down more than 1% over the past week.
Featured image by Dall-E, CryptoQuant.com, chart by TradingView.com