The Binance BTC ratio is nearing the rare buy zone

The key takeaways

• Binance’s Bitcoin/stablecoin is nearing parity, a rare signal in the market.

• BTC is in a profitable regime, according to market structure metrics. However, it’s prone for consolidation.

• If the price drops below $95,000, it could be the trigger for the first bearish 50-week SMA signal of this cycle.

The Binance Bitcoin/stablecoin rate is close to a unique threshold, which historically has been associated with market bottoms. This metric tracks Bitcoin’s balance (BTCBinance’s ) reserve against the stablecoin reserve is approaching parity. This was last seen in March when Bitcoin dropped to $78,000, before recovering and reaching its all-time record high of $123,000.

CryptoQuant data indicates This setup is only seen twice in the past bear markets, which raises interest and could be a buy signal. The catch, however, is that the ratio has flashed in previous cycles at the end bear markets, in 2023, and most recently, in March. The ratio’s return in this context may be a false alarm, indicating the beginning of a long-term correction instead of the bottom.

Binance’s ERC-20 reserve has just surpassed a $37.8-billion record, reflecting steady inflows of funds and deep liquidity. Binance’s ERC-20 stablecoin reserves just hit a record $37.8 billion, reflecting steady inflows and deep liquidity.

Axel Adler Jr. cautioned The market is still in an unstable state “repair phase.” Analyst noted that Bitcoin is at $110 700, which is just above short-term holders realized price of $107 600, an important monthly bull support area.

The structural indicators are still intact. Both the long-term holders’ realized price and overall realized price remain well below their current levels. Net unrealized loss/profit (NUPL ratio) at 0.53 indicates that market remains in broad profit regime, but not yet extreme.

Shortly, the higher timeframes are still bullish. However, profit-taking could cause consolidation to extend. Bitcoin’s capacity to maintain key support will determine whether the Binance Ratio signals another turning point, or if it is a sign of turbulence. 

Related: Bitcoin’s ‘euphoric phase’ cools as $112K becomes key BTC price level

Bitcoin’s SMA 50-week still defines the bear risk

The 50-week moving average is another important indicator for Bitcoin. It has been a reliable way to predict cycle changes since 2018. The historical data indicates that every time Bitcoin closed its weekly candle under the 50-SMA, it followed with prolonged corrections. This led to a 63% decline in 2018, and a 67% drop in 2022. In 2020, BTC recovered quickly from the COVID-19 crash.

Bitcoin’s weekly closing price has not fallen below the 50-SMA indicator since March 20,23. The analysis, based on the adjusted levels, estimates that BTC could be pushed below the 50 SMA for the very first time this cycle if it drops into the $95,000 to $90,000 range.

A move like this would send the first, clear technical signal that a market is in a downturn. The stakes are high as to whether or not the consolidations will end higher or go into a more severe correction.

Related: Bitcoin bear market due in October with $50K bottom target: Analysis

The article is not intended to provide investment advice. Each investment or trading decision involves some risk. Readers should do their own research before making any decisions.