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Research Suggests Bitcoin ‘Not Undervalued’ as BTC Price Skews Near $16K

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bitcoin (BTC) may not be of good enough value to bottom out the macro price, according to CryptoQuant’s analysis.

in a blog post On December 29, a contributor to the on-chain analytics platform flagged one BTC price ticker with further declines.

The profitability indicator lacks a major crossover

At nearly 80% below its all-time highs, BTC/USD is approaching the territory it reached during previous bear markets.

As CryptoQuant’s MAC_D notes, there is no shortage One of the tools that indicates that the bottom of the bear market has already formed in 2022.

Despite this, however, the signals are yet to be unanimous, pointing to trades in profit and loss, and warning that cheaper BTC prices may continue to plunge.

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The output of CryptoQuant’s Unspent Transactions (UTXOs) in the Profit and Loss Index currently shows around 30% of transactions made at a loss.

“When the UTXOs were surpassed in the P&L indicators, the floor was formed during the previous three phases of BTC,” MAC_D explains.

At the moment, however, this indicator does not show a crossover, nor does it show that BTC is undervalued.”

The accompanying chart shows earlier crosses occurring rarely – in June 2016 and May 2020. The latter came on the heels of the COVID-19 crash across the markets in March of that year, and also coincided with the recent Bitcoin halving event.

“It will provide clear buy timing when the crossover is established,” concluded MAC_D.

“Therefore, BTC is likely to drop further, and immediate hedging and downtrend trading is required.”
Illustration of BTC/USD with UTXO data (screenshot). Source: CryptoQuant

Traders say the pain is yet to come

CryptoQuant is not alone when it comes to concerns that BTC price action could get worse before it gets better.

Related: Bitcoin Drop Volume Sparks Warnings About Bitcoin Price As Scale Reaches ‘Value Zone’

Among popular traders, various theories call for a bear market bottom that is much deeper than current spot prices, and this will likely come at $10,000 or less.

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As a possible silver lining, the first quarter of 2023 should see the start of a recovery, with $22,000 even serving as an average. magnet for bulls Later.

BTC/USD is trading below $16,500 at the time of writing, data from Cointelegraph Markets Pro And the TradingView It appears, after hitting its lowest levels in more than a week before the start of the last trading session on Wall Street for the year.

BTC/USD 1-hour candlestick chart (Bitstamp). Source: TradingView

The views, ideas and opinions expressed herein are those of the authors alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.