After weeks of renewed optimism, many in the Bitcoin market now believe the tide is finally turning. Although the price trend of this major cryptocurrency has been steadily improving since early April, the current on-chain structure suggests that expectations may be overstated. According to on-chain analysts, $BTCThe recovery process is unlikely to occur within a few weeks.
Bitcoin may take 6 months to reach bottom: Analyst
In a May 2 post on the X Platform, crypto critic Axel Adler Jr. shared on-chain insights into the recovery path for Bitcoin, the world’s largest cryptocurrency by market capitalization. This on-chain observation is based on an adjusted model of realized price range metrics that reflect the average cost base of different market participants.
The Adjusted Realized Price Range model is calibrated to only consider Bitcoin’s actual circulating supply, filtering out the effects of a significant but dormant portion of the coin’s total supply. This indicator indicates that significant holders who are likely to make decisions in the market are incurring losses or near losses, indicating historical accumulation zones.
Highlighting data from CryptoQuant, Adler Jr revealed that the lower end of the adjusted realization price range model known as “RP Alive” is currently below $59,000. According to on-chain analysts, this price range could be the beginning of a bottom formation for Bitcoin, suggesting that the market leader may still be one step lower.
However, Adler Jr. pointed out that forming a bottom is not a “one- to two-week process,” so just because Bitcoin prices are near the bottom, there is no guarantee that it will turn around soon. Analysts assumed that the base case for bottom formation is approximately six months.
$BTC Bottom price formation depends on recovery of market demand
Adler Jr. further explained the rationale for the six-month base case conclusion, noting that demand remains the core driver of the bottom formation. Next, on-chain analysts said that real demand will only be formed in the long term, not by sentiment or localized rebounds.
Essentially, on-chain analysts believe that a bottom formation will only begin when investors start “seeing value in the future again” and true spot demand returns to the market. Unfortunately, recent on-chain data shows that: $BTCApparent demand remains weak.
At the time of writing this article, the price is $BTC There hasn’t been much movement in the past 24 hours, but it’s around $78,458. The leading cryptocurrency is up nearly 2% on a weekly basis, according to data from CoinGecko.
