These Two On-Chain Signals Precede Bitcoin Falls, Suggests Analyst


An analyst has suggested that two on-chain signals can be used to predict Bitcoin falls, as they appear to have historically preceded falls in the crypto’s price.

Bitcoin Sales Of 7-10 Year Old Coins Have Increased Recently

As indicated by an analyst in CryptoQuant afterBTC dumping of coins aged between 7 years to 10 years and ETH dominance increasing can be two signs to look for before falls in the value of the coin.

The first indicator of importance here is the “Spent Output Age Bands”, which checks for chain movement of coins and tells us which age groups were responsible for them.

The different “coin age groups” in the market include coins based on the amount of time they have sat still before being moved or sold.

The relevant group here is the “7-year-old to 10-year-old” cohort. The Spent Output chart for this group therefore shows how many coins have been moved that previously sat idle for periods in this range. Here is the graphic for it:

Bitcoin Long Term Holder Selling

The value of the metric seems to have spiked up in recent days | Source: CryptoQuant

As you can see in the chart, the quantity marked the relevant trend points for this Bitcoin indicator as well as the corresponding BTC price.

The analyst explains that whenever the spending of the 7- to 10-year-old age group exceeds 5000, BTC usually observes a drop in its value.

Out of the 7 times the signal has been seen over the past few years, only once has the price not registered a dive down.

Ethereum Governance Has Also Been Increased In Recent Weeks

The other indicator that the analyst believes is noteworthy is the “ETH dominance”, which is a measure of the total percentage of the crypto market for Ethereum.

The chart below shows the trend in this metric over the last few years.

Ethereum Rule vs. Bitcoin

Looks like the value of the metric has been high recently | Source: CryptoQuant

It seems that the dominance of Ethereum surpassing the 20% mark was also a bearish sign for Bitcoin during this period.

In conclusion, the analyst suggests that proper use of these two indicators together can help investors prepare for downward trends in the future.

At the time of writing, the price of Bitcoin is floating around $18.7k, down 16% in the last seven days. Over the last month, the crypto has lost 18% in value.

The chart below shows the trend of the coin’s price over the last five days.

Bitcoin price chart

BTC's value has plunged down over the last day | Source: BTCUSD on TradingView
Featured image from Bastian Riccardi on, charts from,



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