Tuesday , June 25 2024
Home / Bitcoin (BTC) / Bitcoin Market Not ‘Top Heavy’ Yet But More Consolidation Expected: Analysts

Bitcoin Market Not ‘Top Heavy’ Yet But More Consolidation Expected: Analysts

Summary:
BTC prices have retreated back below ,000 during Wednesday morning’s Asian trading session but markets are not overbought yet, according to analyst James Check. “Right now, using a variety of volume metrics as the input, BTC prices appear to be right in line with the fundamentals,” he said in a newsletter on May 21. Moreover, the market looks like it did in late-2020, he added. In early December 2020, BTC prices rose to reclaim its 2017 all-time high of ,000. It consolidated around this level for a couple of weeks before surging to a new peak of ,000 by New Year’s Day. The #Bitcoin NVT Price models are a sort of fair value model, imputing a price based on transaction throughput. Right now, using a variety of volume metrics as the input, $BTC prices appear to be

Topics:
Martin Young considers the following as important: ,

This could be interesting, too:

Wayne Jones writes Japanese Publicly-Listed Firm to Increase Bitcoin Holdings via Bond Issuance

Wayne Jones writes Football Icon Ronaldinho Eyes Crypto Comeback Despite Past Controversies

Chayanika Deka writes Bitcoin Bears the Brunt of Growing Pessimism With 0M Outflows

Jordan Lyanchev writes Bitcoin (BTC) Price Breaks Below K for the First Time Since May 3

BTC prices have retreated back below $70,000 during Wednesday morning’s Asian trading session but markets are not overbought yet, according to analyst James Check.

“Right now, using a variety of volume metrics as the input, BTC prices appear to be right in line with the fundamentals,” he said in a newsletter on May 21.

Moreover, the market looks like it did in late-2020, he added.

In early December 2020, BTC prices rose to reclaim its 2017 all-time high of $20,000. It consolidated around this level for a couple of weeks before surging to a new peak of $30,000 by New Year’s Day.

History Rhyming?

During this recent cycle, BTC prices have climbed to almost reclaim their mid-March peak of $73,738 but have found resistance there, indicating positive momentum and potential for entering price discovery territory.

“Only seven days in all history have a closing price above this [$71,000], so we are really breathing thin air up here,” said the analyst.

He added that “punching a convincing all-time-high is rarely successful on the first go” before stating that a period of “chopping wood” and a couple of significant attempts is very normal.

Moreover, the Network Value to Transactions (NVT) ratio suggests that bitcoin’s price is in line with its on-chain transaction throughput, similar to the conditions seen during late 2020.

Additionally, the short-term holder Spent Output Profit Ratio (SOPR) shows that the market is in an “enthusiastic” but not “euphoric” phase, indicating a potentially sustainable uptrend.

This is a condition in which a significant number of holders are caught off guard and buy too many coins at too high a price.

The Glassnode analyst also mentions a “top-heavy” market condition, where a significant number of investors are holding assets at a loss. However, he notes that this condition has improved significantly, with only 6.6% of the short-term holder supply now held at a loss, reducing the risk of panic selling.

More Chopsolidation Ahead

On May 21, fellow analyst “Rekt Capital” predicted that a weekly candle close above $71,500 “would probably kickstart the breakout from the re-accumulation range.” However, BTC prices had already dipped to $69,782 at the time of writing.

He added that history suggests BTC should consolidate inside this re-accumulation range for several weeks more.

You Might Also Like:

Leave a Reply

Your email address will not be published. Required fields are marked *