Can Bitcoin rise above $35K?


bitcoin‘s Price Consolidates as Dark Days Loom Ahead

bitcoin‘s price has been stagnant around the $35,000 mark, indicating a temporary halt to its bull rally. While this consolidation is seen as a positive signal, there are indications that BTC may be overvalued and could be headed for a price correction.

Is bitcoin actually overvalued?

bitcoin investors have celebrated the coin’s ability to remain above a key level. However, the pace of its upward movement has slowed compared to previous weeks. According to CoinMarketCap, BTC only saw a 4% increase in the past 24 hours, currently trading at $35,154.78 with a market capitalization of over $686 billion.

MAC_D, an analyst at CryptoQuant, highlighted that BTC‘s Network Value to Transactions (NVT) signal has reached an apparently overvalued level. The NVT ratio calculates the relationship between market capitalization and transfer volume. At a press time value of 2.19, it suggests that BTC may be overpriced compared to its on-chain transaction volume.

Past recovery phases have also experienced similar overvalued NVT signals which subsequently led to further price gains and a transition to a bull market. While the NVT signal has different behaviors historically, it’s worth exploring other metrics to determine if a price correction is on the horizon.

bitcoin might witness a correction

CryptoQuant’s data revealed that BTC‘s exchange reserve was increasing, indicating heightened selling pressure. Additionally, its aSORP (average Spent Output Profit Ratio) was red, suggesting that investors were selling their holdings at a profit. These factors can be interpreted as signs of a potential market top in a bull market.

Other market indicators also indicate bearishness. The MACD displayed a bearish crossover, while BTC‘s RSI was in the overbought zone. The Money Flow Index (MFI) showed a decline and was approaching the neutral mark, further increasing the likelihood of a price correction.

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### News source: ambcrypto.com

By Team