Bitcoin (BTC) has delivered a “healthy reset” to bullish sentiment thanks to a key BTC price indicator hitting eight-month lows.
In a post on X (formerly Twitter) on June 27, popular analyst On-Chain College said that classic patterns were repeating on the Bitcoin Mayer Multiple.
Mayer Multiple reaches lowest since October 2023
Bitcoin is still at $60,000, but a strikingly bearish mood has accompanied its latest 17% dip.
As Cointelegraph reported, the Crypto Fear & Greed Index is challenging 2024 lows, and across social media, there are few signs that the average hodler expects a price turnaround.
The Mayer Multiple, however, is arguably suggesting that a recovery could soon take shape.
The indicator measures Bitcoin’s current price against its 200-day moving average, and the resulting ratio is used as a buy or sell signal. Its creator, Trace Mayer, originally gave a reading of below 2.4 as “buy” territory.
Data from on-chain analytics firm Glassnode shows that as of June 26, the Mayer Multiple measured 1.05.
Conversely, for the Mayer Multiple to hit the 2.4 level, the price would need to be nearly $140,000. BTC/USD last achieved a 2.4 reading in March 2021.
“The Bitcoin Mayer Multiple is now at a level not seen since October 2023, despite price at $60.9K now vs. $29.9K back in October,” On-Chain College wrote in part of accompanying commentary.
“A healthy reset of sentiment to shift back bearish while being at twice the price.”
Extreme lows in the Mayer Multiple do not always correspond to BTC price floors. In mid-2022, the indicator bottomed at around 0.47, but it was another four months before the price did likewise to mark the pit of the bear market.
Trader on overbought Bitcoin: “History repeating?”
As Cointelegraph continues to report, price strength is a popular topic of debate in June as the Mayer Multiple is not the only “buy” signal currently valid.
Related: Bitcoin price wobbles at $61K as US gov sends 4K BTC to Coinbase
Bitcoin’s relative strength index (RSI) has also dipped into “oversold” territory across multiple timeframes.
On the daily chart, RSI was previously at this week’s levels in August 2023 — a time at which other bull market support trendlines, such as the short-term holder cost basis, were being violated in a similar way to now.
“The last time the RSI was this low, Bitcoin had just consolidated for 3+ months, just below the key resistance @ 30k,” popular trader Jelle wrote in part of his latest X post on the topic.
“We’re looking at 3+ months of consolidation below 70k now. History repeating?”
BTC/USD traded at around $60,700 at the time of writing, per data from Cointelegraph Markets Pro and TradingView.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.