Bitcoin’s spot rate is on the rise. It reached $63,000 before reversing. The price action is still a bit volatile, even though the momentum of the coin is growing. source Debate. Some are still sceptical, believing that there may be a reason for an overvaluation.
Bitcoin is overvalued. Here’s why.
One analyst posted a message on X. argues The coin is likely to cool down, continuing the 18% decline registered in June. In conclusion, the analyst stated that the prediction factored several parameters including time, number of Bitcoin address active, and hash rate.
This model led the analyst to say that the bulls were not going to continue their upward trajectory. It dampened the spirit of the optimistic traders who had been expecting them to. Bitcoin has returned to the multiple-week range as I write this, with all-time-highs at its apex and support of $56,800 from May.
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Price action shows that the buyers have control, at least if you look from top down. Even though prices have dropped, and especially since May’s price breach of $60,000, bulls can still win based on a top down preview.
Prices are currently inside of a bull’s eye after Q1 gains 2024. The uptrend is being slowed down by the buyers who failed to confirm their gains at mid-March.
On the daily chart of the stock, buyers failed to reach $74,000. $72,000 is an important liquidation level. The trend may change in the near term if the prices rise decisively over $66,000 and preferably with a rising volume of trading.
Germany’s BTC gains versus the M1 Money supply in United States
The recent German dump has heightened concerns. They transferred over $94 Million worth of BTC on July 1. Lookonchain data Shows 400 BTC sent to Bitstamp and three other exchanges.
Though it is not immediately clear if they sold, sending them to exchange means they are keen on offloading them–a net bearish. At the moment, an address linked to the German government holds more than 44,000 BTC valued at $2.5 billion.
BTC has its supporters, even amid the concerns. One analyst pointed out that the BTC price is poised for major gains by citing the correlation between M1 US money supply and BTC.
The analyst looks at the graph. argues Bitcoin is not at a record high in the United States M1 Money Supply for more than six years.
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The bulls are likely to take control, as the BTC price has been steadily rising since the middle of 2023. This will lead the coin towards new highs.
TradingView chart with DALLE image
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Source: www.newsbtc.com