Bitcoin has broken through the $77,000 level to reach a new all-time high. However, investors are wondering whether this rally will lead to profit taking or if there is room for further gains. The market is increasingly convinced that Bitcoin is still undervalued. As Bitcoin enters the price discovery zone, it is necessary to go beyond traditional technical analysis. On-chain metrics are critical to supporting investment decisions. Here are the metrics that show Bitcoin is still undervalued.
Is Bitcoin Still Undervalued? 5 On-Chain Indicators
The Rainbow Chart, provided by Blockchain Center, is a tool that evaluates Bitcoin’s long-term price trends. The chart indicates that Bitcoin is still in the “undervalued” territory. Analysts say that these levels present an attractive buying opportunity for investors.
Another important metric is the RSI indicator. The RSI indicator is currently at 70.83. It also shows that Bitcoin (BTC) has not yet reached the overbought territory. This suggests that the current price action has not peaked and there is potentially more room for growth. Traders need to follow the RSI indicator to understand the direction of the market.
200-Week Heat Map and CVDD Data
The 200-Week Moving Average Heatmap is another important metric . This metric shows that Bitcoin’s current price is still in the “blue zone,” which is usually a buying opportunity. Historically, Bitcoin held in this zone has yielded significant returns.
Cumulative Value Days Destroyed (CVDD) is also one of the metrics to watch. CVDD data signals appreciation in the market when the Bitcoin price approaches the orange line. Currently, this metric indicates that BTC has not yet reached its peak and presents a potential buying opportunity .
Which Way Will Bitcoin Price Go? These Metrics
The 2-Year MA Multiplier is also an important metric. According to this indicator, Bitcoin has not yet reached the red trend line. This shows that there is more room for growth before the market reaches its potential peak.
With all this data , Santiment states that increasing FOMO on social media may increase the risk of a correction in Bitcoin prices. As we reported at Kriptokoin.com, historically, periods of excessive optimism often result in price pullbacks. Investors are advised to follow this trend carefully and manage the effects of FOMO. Bitcoin’s current price action shows that further increases are possible, but market dynamics should be monitored closely.
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