Cryptocurrency analyst Ali Martinez, in his latest analysis shared on Twitter, claimed that a level observed in previous rallies in Bitcoin was recorded again.
Ali Martinez Draws Attention to Reserve Risk Data in Bitcoin
According to Martinez, when Bitcoin Reserve Risk rises above 0, it indicates parabolic price movements. The analyst cited historical data where this indicator led to increases of 2,830, 566%, 6,400, 99% and 487% in 2012, 2013, 2015, 2019 and 2020, respectively.
Martinez said Reserve Risk data has risen above 0 again, hinting that a new rally could begin.
However, Bitcoin didn't always rally when Reserve Risk went above 0. For example, in December 2017 the Reserve Risk had reached 0.0225, but the Bitcoin price then dropped sharply.
This #Bitcoin indicator signals huge potential!
When the $BTC Reserve Risk moves above 0, it signals parabolic price moves. In 2012, 2013, 2015, 2019, and 2020, it resulted in gains of 2,830%, 566%, 6,400%, 99%, and 487%, respectively.
Reserve Risk just crossed 0 again!👀🙀 pic.twitter.com/NQI39IKUI8
— Ali (@ali_charts) April 17, 2023
Reserve Risk is a metric that measures the risk/reward of buying Bitcoin based on the opinions of long-term coin holders. It is calculated as the ratio between the current price of Bitcoin and the opportunity cost of not selling. The higher the reserve risk, the higher the confidence of the long-term owners and the lower the incentive to sell.
In general, however, reserve risk tends to increase during bull markets and decrease during bear markets. Therefore, it can be used to measure market sentiment and long-term holder behavior.
*Not investment advice.
