On-chain data shows the 7-day moving average (MA) Bitcoin Puell Multiple has hit a 14-month high recently. Here’s what it may mean for the market.
As pointed out by an analyst in a CryptoQuant post, the BTC price was around $48,000 the last time the metric was at its current level. The “Puell Multiple” is an indicator that measures the ratio between the daily revenue of the Bitcoin miners and the 365-day MA of the same (both in USD).
When the value of this metric is greater than 1, it means the miners are making more right now than the average for the past year. If the indicator hits very high values above this mark, then miners become likely to sell as they are likely raking in a significant amount of profits.
On the other hand, the multiple being below the threshold implies the mining revenues are less than the norm at the moment. Low enough values under this mark have historically been a sign that the cryptocurrency is undervalued.
(By Hououin Kyouma)
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