According to BlockBeats, on-chain data analyst Murphy has analyzed the concentration of BTC chips, noting a significant decrease from 15.5% to 8.2% between May 7 and May 14. This decline suggests that as prices rise, they are moving away from the concentration zone. If the concentration curve continues to fall, it is likely that prices will keep increasing.
After May 14, the concentration curve stopped declining around 8.2% and showed a slight upward turn. This level of concentration is neither significantly high nor low. If prices fall back into the BTC chip concentration zone, the concentration curve is expected to rise rapidly again, potentially leading to greater volatility. A similar pattern was observed on January 23, 2025, when a price correction caused the concentration to drop from a high point before turning upward again, resulting in increased price volatility. Another possibility is that prices continue to rise, causing the concentration curve to pause briefly before continuing downward, similar to the situation on November 3, 2024.
In summary, the current pause in the concentration curve's decline introduces uncertainty in market direction. It is challenging to predict a bullish or bearish trend based solely on this indicator. However, the concentration curve suggests that the market may soon choose a direction for volatility. When concentration reaches a certain height, considering a strategy to capitalize on volatility might be beneficial. These market insights are intended for educational purposes and should not be considered investment advice.
Weatherly
