- Bitcoin’s bull market remains intact, despite recent data errors and confusion.
- Neutral PnL Index suggests Bitcoin is in a consolidation phase, not extreme fear.
- BTC’s price above the 365-day moving average signals potential for upward momentum.
Bitcoin’s price action has been a topic of much debate, especially after recent signals pointed to potential pullbacks. On January 22, Ki Young Ju, the founder of CryptoQuant, shared insights about Bitcoin’s market trajectory, suggesting that Bitcoin could either pull back or trade sideways for months.
However, he clarified that the bull market may not be over, as some on-chain indicators remain firmly bullish. This assertion comes after a data error that had previously created confusion, but Ki Young Ju retracted his earlier tweet, offering further clarification on the issue. Despite the confusion, the outlook for Bitcoin appears positive.
Data Error and Bullish Sentiment
Ki Young Ju’s recent analysis pointed to a critical error in the data processing, particularly concerning PCA (Principal Component Analysis). A coding mistake had reversed the sign of a coefficient, which caused a temporary shift in the interpretation of Bitcoin’s on-chain signals.
As a result, his team’s analysis of Bitcoin’s market cycle was initially skewed. The corrected data now suggests that the bull market is still intact. This updated view emphasizes Bitcoin’s continued bullish outlook, with significant on-chain metrics backing this conclusion.
Additionally, Jerry Yun, a developer at CryptoQuant, explained the technical details behind the error, shedding light on how PCA works. He noted that the sign of the solution’s eigenvector doesn’t impact the final result, ensuring that the trend analysis remains largely unchanged.
The corrected PnL Index now more accurately reflects Bitcoin’s market conditions, reassuring investors that the cryptocurrency’s bull cycle is not over. This analysis provides a more reliable perspective, helping to ease market concerns.
Key Indicators for Bitcoin’s Next Move
Bitcoin’s price is currently hovering near $105,183, with a strong 24-hour trading volume of $97.4 billion. This price level is a critical point in the ongoing market cycle.
The PnL Index, as seen in the updated chart, shows Bitcoin’s price moving above its 365-day moving average, which is historically a bullish signal. However, the current PnL Index is near neutral territory, indicating a market neither in extreme fear nor excessive euphoria.
This neutral zone suggests that Bitcoin’s price is in a consolidation phase. If Bitcoin maintains its position above the 365-day moving average, there could be further upward momentum.
However, caution is required as the market nears the overbought zone, which could signal potential sell pressure. Support levels, particularly near the $20K mark, are crucial for maintaining bullish sentiment.
