Nicholas Merten from Data Dash delivers a deep dive into Bitcoin and cryptocurrency trends. The CoinSpeech team has collected the most important insights from his latest appearance. You can watch Nicholas Merten’s new video below.
Understanding Price Action and Moving Averages
Nicholas addresses the stagnation in Bitcoin’s price over the last three months, emphasizing the lack of resilience and persistent weakness. “We are getting a lot more comfortable retesting these longer-term moving averages and with a lot less resilience from what we had in the past,” he explains. The sluggishness around the 100-day moving average indicates a potential decline to the 200-day moving average.
The Role of ETFs
The Bitcoin ETF has been a key driver of market cycles; however, the ETF inflows are not sustaining the price as expected. “The ETF is really not setting in this huge surge just swallowing up all the demand of Bitcoin,” Nicholas asserts. The data reveals a weakening pattern in weekly inflows, underlining a more significant issue where “over time, while we’ve had our outflow weeks and those obviously are not good for the net number, we also have something that’s actually much more concerning.”
Market Seller Dominance
One notable concern is the dominance of market sellers over buyers. “The broader markets that determine the spot bitcoin price… there are more market sellers… then market buyers,” Nicholas clarifies, hinting at an imbalance unfavorable for Bitcoin’s price stability.
Data Science Models and Historical Trends
Analyzing various models like the “R HODL Ratio,” Nicholas notes, “It has been one of the data science models that showcased in prior cycles when things were getting overheated.” The current values indicate potential overextension in the short term, showing that the correction may not be over yet.
Altcoins and Investment Opportunities
Nicholas emphasizes caution yet also highlights potential in altcoins. “There are a couple different things you should keep in mind… I focus in on altcoins and while I might sound very bearish here in the short term, it doesn’t mean that I don’t see greener pastures.” He discusses specific altcoins such as Render and Stacks and their market performance against Bitcoin.
Equities and the AI Euphoria
The excitement around AI, particularly with stocks like Nvidia, also ties into the broader market trends. Nicholas remarks, “The more we move closer to [historic resistance], and we don’t have a clear confirmed weekly breakout or monthly high above that resistance, I’m much more eager to stay in cash.” This cautionary approach extends to both crypto and stock markets.
In summary, Nicholas advises thorough analysis and prudent decision-making, emphasizing, “We need to be much more skeptical here… Bitcoin is no longer an infant asset, it’s at a $1.3 trillion market cap, and we got to start treating it as such when it comes to our trading expectations.”