Bitcoin ‘not undervalued yet,’ says research as BTC price drifts nearer to $16K

Bitcoin (BTC) will not be at a great worth sufficient for a macro value backside, based on evaluation from CryptoQuant.

In a weblog publish on Dec. 29, a contributor to the on-chain analytics platform flagged one BTC value indicator with additional left to fall.

Profitability indicator lacks key cross

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

As CryptoQuant’s MAC_D notes, there’s no shortage of instruments pointing to the 2022 bear market backside already forming.

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

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

“When the UTXOs in Revenue and Loss indicators have been crossed, the ground was fashioned through the previous three BTC Halvings,” MAC_D explains.

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

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

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

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

Max ache but to come back, say merchants

CryptoQuant is much from alone in terms of considerations that BTC value motion could worsen earlier than it will get higher.

Associated: Bitcoin low volume sparks BTC price warning as metric hits ‘value zone’

Amongst 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 lower.

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

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

The views, ideas and opinions expressed listed here are the authors’ alone and don’t essentially mirror or signify the views and opinions of Cointelegraph.