On-chain metrics and short-term price action, how to reconcile?
I've been trying to get a handle on how to use some of the deeper on-chain metrics, like SOPR or MVRV, when looking at short-term moves in things like $BTC or $ETH. I see a lot of analysis suggesting these metrics indicate long-term accumulation or potential macro bottoms, which makes sense. But then you get into a situation where a metric might be flashing a 'buy' signal based on historical context, yet the price is clearly in a downtrend on the daily or even weekly chart, driven by broader market sentiment or news. It feels like there's a disconnect for me between the very long-term view these metrics provide and the more immediate challenges of navigating shorter-term volatility. How do you experienced traders integrate these longer-term on-chain signals with your short-term tactical decisions, or do you view them as entirely separate lenses?
That's a common challenge. My take is that on-chain metrics are best viewed as macro indicators, signaling broader market sentiment and potential trend shifts, rather than precise timing tools for short-term price action. They often provide context for why certain moves are happening, but not necessarily when.