Bitcoin’s near-term movement could continue to be sideways as the overvaluation indicator is now flashing orange, signalling a high likelihood that Bitcoin holders will take profits.
Bitcoin’s (BTCThe Market Value to Actual Value (MVRV), an indicator which measures whether or not the asset has been overvalued, is currently at 21%. This means that investors who bought Bitcoin in the last year are comfortably profiting, according to sentiment platform Santiment said In a Monday report.
Bitcoin could experience a sideways movement in price
“While not at extreme historical highs, this is considered a mild danger zone, as it increases the risk of profit-taking,” Santiment explained.
Bitcoin has traded at $115.800 since publication. according According to CoinMarketCap’s data, the price is approximately 6% lower than its Wednesday high of $124,128.
Bitfinex analyst’s claim: Bitcoin price saw a 10% rally over the last nine days, leading to its new record high. said Markets report the day after the “rally quickly fizzled out” Due to the absence of macroeconomic drivers needed to maintain the price.
Investors are more likely to profit when Bitcoin reaches new price highs, and begins to stabilize or decline.
Analysts at Bitfinex believe that Bitcoin’s price may be sideways in the short term.
“The market is now firmly in a consolidation phase, adopting a wait-and-watch stance as investors weigh upcoming macro catalysts,” The analysts stated.
Many market participants will be closely monitoring the US Federal Reserve’s decision to cut rates on September 17, as 83.6% of them expect the much-anticipated cut. according CME Federal Watch Tool
Bitcoin traders do not expect much of a rise in Bitcoin prices.
Bitcoin short positions have also been increasing, and are estimated to be worth $2.2 billion. If Bitcoin returns to its all-time $124,128 high, these short positions will need liquidating. according CoinGlass is a great way to collect coins.
Related: Was the Bitcoin price bottom $114.7K?: Data suggests it’s time for a reversal
Santiment claims that Bitcoin whales remain confident about higher prices.
“Bitcoin’s largest holders are not selling into this rally,” Santiment said.
“Wallets holding between 10 and 10,000 BTC have continued to accumulate aggressively, even after the all-time high,” Santiment is added.
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Source: cointelegraph.com
