Bitcoin (BTC) Rallies to $58K but Crypto Analyst Warns Market Is Still in a Bearish Phase

Bitcoin (BTC), the largest cryptocurrency by market capitalization, rose to highs of $58,487 in the early Thursday trading session. However, amid this price rise, a prominent crypto analyst has issued a warning, urging caution as the market heats up.

Bitcoin (BTC) price rose to highs of $58,487 in the early Thursday trading session, showing a 2.18% gain over the past 24 hours. However, a prominent crypto analyst has issued a warning amid this price rise, urging caution as the market heats up.

According to Julio Moreno, Head of Research at CryptoQuant, valuation metrics indicate that the price of Bitcoin remains bearish.

Moreno stated that Bitcoin is still in a bear phase and has decoupled from gold as investors switch to risk-off mode.

Bitcoin remains in a bear phase and it has decoupled from Gold as investors switch to a risk-off mode.

In its recent analysis, CryptoQuant highlighted that the Bull-Bear Market Cycle Indicator has been in a bear phase since Aug. 27, when the price of Bitcoin was $62,000. A significant rally is unlikely to occur as long as the indicator stays in the bear phase.

Moreover, the MVRV ratio has fallen below its 365-day moving average since Aug. 26. A cross below the 365-365 day moving average indicates the possibility of a further price correction. This situation was also present in May 2021, when Bitcoin fell 36% over two months, and in November 2021, when the last bear market began.

Bearish signs are also seen in Bitcoin long-term holders (LTH) spending at lower profit margins. The LTH SOPR ribbons have been drifting lower since late July. LTHs spending at lower profit margins shows a lack of new demand for Bitcoin.

Bitcoin briefly hits $58,000, but what do key metrics say?

Bitcoin (BTC) price briefly surpassed $58,000 in early Thursday trade, as a surge in U.S. equities and gains in the Asian share market helped to bolster risk appetite.

U.S. inflation data for August showed that core inflation rose faster than expected to more than 0.3%, although this was still lower than the 0.4% increase predicted by economists. The reading fueled bets on a Federal Reserve rate cut in the coming weeks.

At the time of writing, BTC is trading at $58,025, up 2.18% in the last 24 hours. However, U.S. spot bitcoin exchange-traded funds (ETFs) returned to outflows on Wednesday, according to data from Harvest Commodity Research.

The funds lost $43 million in outflows, after two days of inflows.

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