• Crypto analyst Nicholas Merten believes that analyzing momentum indicators is important to understand the market’s short-term direction.
• He noted that Bitcoin has not made new highs for nearly a month and stablecoin liquidity has remained flat, which raises doubts about the potential for a new bull market.
• Challenges such as setback by FTX and Celsius, as well as loss of institutional backbones have hindered on-ramps and off-ramps for large-scale crypto companies.
Is The Crypto Market Primed For Bull Run Soon?
Popular crypto analyst Nicholas Merten of the YouTube channel DataDash recently shared his thoughts on the current state of Bitcoin and the crypto market. He emphasized the importance of analyzing momentum indicators to understand the market’s short-term direction. Despite bullish signs in its weekly timeframe, Bitcoin has not made new highs for nearly a month, and its price is at its lowest since March 17th. This stagnation in trend leads to questions about whether or not the market is ready for another bull run.
Merten applied numerous narratives to explain the potential for a new bull market, such as central bank balance sheet expansion or bank runs. However, he argued that none of these narratives have held true, as the U.S Central Bank balance sheet has contracted, and stablecoin liquidity has remained flat. According to Merten an increase in stablecoin liquidity is essential for on-ramps of new liquidity from hedge funds, family funds, and high net worth individuals into cryptocurrency markets; however it appears that this is currently contracting instead of increasing.
Current Challenges In The Crypto Space
The challenges faced by the crypto industry include setbacks caused by FTX and Celsius exchanges along with losses from institutional backbones like Genesis Silver Gate and Signature Bank hindering both on rams and off ramps for large scale companies entering into cryptocurrency markets; this situation contributes to dollar liquidity stagnating in crypto space overall.
It remains uncertain if there will be another upsurge soon due to lack of clear evidence pointing towards either direction; although there are some signs which may indicate an upcoming bull run it can still take weeks or months before we see any significant changes in prices or trends due to current challenges faced by cryptocurrency markets overall.
• Momentum indicators are necessary to understand short term movements within cryptocurrency markets • Stablecoin liquidity needs to increase for larger scale companies entry into crypto space • Current challenges faced by cryptocurrency industries need addressing before any strong trends can be seen