Some important figures show that BTC is currently trading at a relatively low price, having fallen 60% in the past 3 weeks.
Cryptocurrency analysis firm Glassnode said that Bitcoin's market value on real value (MVRV) Z-score dropped below zero on Friday and at -0.18 on Monday. define the times when cryptocurrencies are undervalued or overvalued.
Z-score has turned negative for the first time in 12 months, showing that cryptocurrencies are currently undervalued.
Bitcoin reached its highest price in 2020 at $ 10,500 in mid-February and fell to a 12-month low of $ 3,867 on March 13.
King coin suffered a staggering 39% drop on Thursday after the global stock market was sold off by Corona, triggering margin buying orders and forcing investors to liquidate Bitcoin positions.
Bitcoin's market value refers to the total dollar value of the circulating supply, which is calculated by the average daily price on major exchanges.
Meanwhile, the real price is the value paid for all existing coins by adding the market value of the coins at the time they last moved on the blockchain.
The real price is closer to the fair value because it corrects both lost coins and coins held for a long time (so-called HODLing). Thus, the MVRV Z-score basically represents the distance or deviation from the real price.
Historically, MVRV Z-score below 0 (green area) has marked the market bottom, while the index above 7 is the peak.
For example, Bitcoin dropped below $ 6,000 on November 14, signaling a prolonged sell-off from a record high of $ 20,000 achieved in December 2017. The price dropped to $ 3,400 on November 25.
Z-score also turned negative in the second half of November and dropped to -0.51 in mid-December. The sell-off weakened when prices traded near $ 3,100 in December and entered the bull market in April. when merging.
Basically, the downward momentum weakens when the Z-score turns negative.
Back in time, the bear market in 2014 started at a high of over $ 1,000 at the end of 2013 and lost nearly $ 150 in January 2015 with the Z-score dropping to -0.5. Once again, after several months of consolidation, cryptocurrencies entered the bull market in November 2015.
Therefore, if history repeats itself, the current MVRV Z-score of -0.18 indicates that BTC may be trading near the bottom.
At the time of writing, Bitcoin is trading in the green of $ 5,218, representing an increase of nearly 6.14% in 24 hours.
Futures contract stock recuperate
Stock market futures in the United States, Asia and Europe have recovered somewhat. Notably, futures contracts on the S&P 500 (Wall Street's stock index and global stock benchmark) rose nearly 5% at the beginning of Tuesday, pushing “the limit up.”
Bitcoin has recently followed the stock market action and may continue to do so in the short term. At the same time, from a technical perspective, the ongoing recovery phase will continue to expand.
Bitcoin created a hammer candle on Monday, confirming the oversold conditions proposed by the relative strength index for 14 days. The hammer candlestick consists of a long low wick with a small body and occurs when the seller fails to keep the price at the lowest level of the day. Basically, it shows that the seller is running out.
Therefore, the price can move to the range of $ 5,900 – 6,000 in the next 24 hours. That range has recently limited the rise of cryptocurrencies.
Buyers need to prevent the price from breaking below the support of the ascending trendline at $ 4,672 at the moment as it will threaten to a higher low at $ 4,435 formed on Monday.
If that fails, we expect to see $ 4,000 appear on the board. According to the chart, the area above $ 5,900 has been a big challenge for the bulls for the past 4 days. Therefore, a sustainable move above that level is necessary to stimulate stronger buying pressure.
Is Bitcoin likely to reach $ 6,100?
Trader ‘The Crypto Dog’ shared his bullish stance and tweeted that Bitcoin was strong enough to try to break above $ 6,000. In another tweet, the trader emphasized: ‘The bullish scenario appears in my mind. Just play at each level now.
Technically, $ BTC looks powerul and hungry for $ 6100 right now.
– The Crypto Dog (@TheCryptoDog) March 17, 2020
“Technically, BTC seems strong and strong lust 6,$ 100 right now. ”
Test the highs of pMicro range about 5,600 – 5,700 dollars
Analyst Michael van de Poppe (also known as 'Crypto Michael') is also very optimistic. He summarized the current market situation for Bitcoin, confirming that when he turned $ 5,200 into support, BTC was preparing to test a high range at $ 5,600 – $ 5,700.
He also predicted that the stock market would recover.
The good news here;
Eld Held the $ 4,850 area for support.
Ipped Flipped the $ 5,200 level for support just now.
Looks like we cant going to attack the range highs around $ 5,600-5,700 for a test.
Equity markets hit the upper limit band -> bounce seems likely. pic.twitter.com/58yivhPzod
– Crypto Michaël (@CryptoMichNL) March 17, 2020
– Hold the $ 4,850 area to Supported.
– Turned over $ 5,200 Fort support now.
It seems we will attack the highs range in the range of 5,600 – 5,700 dollars to kiểm TRA them.
Stock market touches the upper bound range -> it seems will increase”.
'Bitcoin is ready to rise'
Trader ‘Bitcoin Jack’ believes Bitcoin is getting ready. According to him, this is confirmed by an analysis of price and time equilibrium.
This should now be ready, in terms of price and time balance analysis, to start its ascend
– // Bitcoin ack (@BTC_JackSparrow) March 17, 2020
“In terms of an analysis of price and time equilibrium, BTC Now ready to go up.
Price has passed our golden ratio. “
Twitter user Axed dismissed this view and mentioned the wider spread of the COVID-19 virus, but he still thinks the price will rise.
“The virus situation is getting worse every day. People are unemployed all over the world. They are afraid to go out. Businesses suffer from losses, do not recruit and the stock market is plummeting. Do you still think it will come up from here? ”
Trader George tweeted that BTC would see some upward movement. However, he did not rush to place long orders.
Broke above the weekly open. I'm out of my short hedge. Seems like we’ll see some upside. Not going to long this. Not my setup. Watching the highs for a potential short play. Let's see what we get today! pic.twitter.com/gvwWMiK9YD
– George (@ George1Trader) March 17, 2020
“Break on level open weekly. I will exit the short fence. It seems we will see some upward move. It will not be long. Keep track of high level to short potential. Let's see what we have today! ”
You can see the price of Bitcoin here.
Disclaimer: This is not investment advice. Investors should research carefully before making a decision. We are not responsible for your investment decisions.
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