Glassnode Introduces Breakdown Metrics to Identify Local Bottoms in Bull Market

Glassnode Launches 28 New Metrics

On-chain market intelligence provider, Glassnode, has released a suite of 28 new metrics aimed at providing a more granular view of the digital asset market, according to a recent blog post. These metrics are expected to be a game-changer for traders, providing detailed insights that can be translated into potential buy and sell signals.

Identifying Local Market Bottoms

One significant application of these new metrics is identifying seller exhaustion across different age cohorts within short-term holders. The new Breakdown metrics allow traders to more accurately pinpoint moments of severe unrealized loss and capitulation, which often signal local market bottoms and potential entry points during a bull market. These insights are crucial for traders seeking to optimize their market entries or Dollar-Cost Averaging (DCA) strategies.

Focus on Short-Term Holders

In the context of on-chain analysis, short-term holders represent a distinct group with different behaviors and market impacts. These investors, often newer entrants or speculative traders, are more sensitive to price changes. Their analysis is particularly valuable for identifying local market bottoms as they are more prone to selling in response to market volatility.

Benefits of Breakdown Metrics

By breaking down the short-term holder cohort into granular age bands, the metrics help traders identify periods of seller exhaustion more effectively. The metrics detect capitulation events across different short-term timeframes, enhancing the likelihood of identifying a local bottom. This inside-out progression provides a clearer signal of potential local bottoms and subsequent market reversals.

Practical Applications for Traders

The new Breakdown metrics can offer numerous advantages for traders, including early detection of local bottoms, optimized DCA strategies, enhanced market timing, and strategic flexibility. By leveraging these insights, traders can gain a competitive edge in the market, making more strategic and profitable decisions.

Access to Glassnode’s Breakdown Metrics

The breakdown metrics are currently exclusively available with the Glassnode Enterprise plan. If you're an institutional trader or investor and wish to leverage these metrics to gain a deeper edge in trading the Bitcoin and Ethereum markets, you can contact their institutional sales team.