Bitcoin may be headed for more sideways movements in the short term, as a metric that indicates overvaluation is flashing red. This signals a greater likelihood of Bitcoin owners taking profits.
Bitcoin’s (BTCSantiment’s sentiment platform reports that Market Value-Realized Value (MVRV), a measure of whether an asset is overvalued is at +19%, which means the investor average who has purchased Bitcoin during the past 12 months is in a comfortable profit. said A report was published Monday.
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 was trading for $115,800 as of the date this article is published. according CoinMarketCap estimates that the value of Bitcoin is currently 6% less than Wednesday’s record high, $124 128.
Bitfinex analysts claim that Bitcoin’s price rose 10% in nine days before the high. said In a report of the markets on the day the “rally quickly fizzled out” Due to the absence of macroeconomic drivers needed to maintain the price.
Investors have tended to sell their Bitcoins when the price reaches a new high and then starts to trend down or consolidate. They fear that Bitcoin may be reaching a local top.
Bitfinex analysts said that Bitcoin could experience a sideways movement in price near-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 investors aren’t expecting much upside for the Bitcoin market in the short term.
Bitcoin shorts are also increasing, and there is a risk that $2.2 billion of short positions will be liquidated if Bitcoin returns to its all-time $124,128 high. according CoinGlass
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 added
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Source: cointelegraph.com
