Bitcoin ‘not undervalued but’ says research as BTC price drifts nearer $16K

Bitcoin (BTC) might not be good worth sufficient for a macro price backside, in keeping with evaluation from CryptoQuant.

In a weblog put up on Dec. 29, a contributor to the on-chain analytics platform flagged one BTC price indicator with additional to fall.

Profitability indicator lacks key cross

At almost 80% under all-time highs, BTC/USD is nearing the zone by which it bottomed throughout earlier bear markets.

As CryptoQuant’s MAC_D notes, there isn’t any scarcity of devices pointing to the 2022 bear market backside already forming.

Despite this, nonetheless, the indicators should not but unanimous, and pointing to transactions in revenue and loss, he warns that cheaper BTC costs should still enter.

CryptoQuant’s unspent transaction outputs (UTXOs) in revenue and loss indicator presently reveals round 30% of transactions carried out at a loss. 

“When the UTXOs in Profit and Loss indicators had been crossed, the ground was shaped in the course of the previous three BTC Halvings,” MAC_D explains.

Currently, nonetheless, this indicator doesn’t present a cross, and doesn’t present that the BTC is undervalued.”

An accompanying chart reveals earlier crosses occurring solely not often — in June 2016 and May 2020. The latter got here within the aftermath of the COVID-19 cross-market crash in March of that yr, and likewise coincided with Bitcoin’s newest block subsidy halving occasion.

“It will present a transparent shopping for timing when the cross is generated,” MAC_D concluded.

“Therefore, the BTC is more likely to fall additional, and spot hedging and down development buying and selling are required.” 

BTC/USD annotated chart with UTXO information (screenshot). Source: CryptoQuant

Max ache but to come back, say merchants

CryptoQuant is way from alone in relation to considerations that BTC price motion could worsen earlier than it will get higher.

Related: Bitcoin low quantity sparks BTC price warning as metric hits ‘worth zone’

Among common merchants, varied theories name for a a lot deeper bear market backside than present spot costs, this probably coming in at $10,000 or decrease.

As a possible silver lining, Q1 2023 ought to see the beginning of a restoration, with $22,000 even appearing as a magnet for bulls in a while.

BTC/USD is buying and selling under $16,500 on the time of writing, information from Cointelegraph Markets Pro and TradingView reveals, having hit its lowest ranges in over per week earlier than the beginning of the ultimate Wall Street buying and selling session of the yr.

Bitcoin 'not undervalued but' says research as BTC price drifts nearer $16K
BTC/USD 1-hour candle chart (Bitstamp). Source: TradingView

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