Bitcoin Just Post ‘Very Rare’ Buy Signal, Says Crypto Hedge Fund CEO Su Zhu

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Su Zhu, co-founder and CEO of crypto hedge fund Three Arrows Capital, said Bitcoin has just given a rare bullish signal.

Zhu points out to his 447,000 Twitter followers that Bitcoin’s dormant flow metric has just reached a level seen only five other times in history.

“Signal to buy dormant stream on $ BTC, very rare, only six times in history.”

Source: Su Zhu / Glassnode / Twitter

Dormancy flow refers to the average number of days each spent part has been dormant before being moved. The metric can be used to time market lows and assess whether the bull market remains under relatively normal conditions.

Another on-chain measure for Bitcoin that Zhu finds remarkable is its illiquid supply. Illiquid sourcing refers to BTC in wallets with little sales history. When the illiquid supply increases, it suggests an absence of selling pressure on BTC and increases the chances of a rally.

“The illiquid supply has increased sharply since July 2021, in line with the accumulation trend from January 2019 to April 2021.”

Source: Su Zhu / Glassnode / Twitter

According to Zhu, Bitcoin is in a long period of accumulation with an overall bullish market structure.

“Bitcoin is in a multi-year process of higher ups and downs, with 2021 being a relatively quieter year against a backdrop of sideways accumulation.

Buying highs or selling funds can be quite dangerous in this scheme, causing buy + hold to underperform significantly.

At the time of writing, Bitcoin is trading at $ 42,785, up 3.5% on the day, but still down almost 40% from its all-time high above $ 69,000 in November. 2021.

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Featured Image: Shutterstock / Sittipong Phokawattana

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