Following the release of US unemployment figures, the price of Bitcoin (BTC) began to recover from its prior low. The asset’s value has maintained above the crucial psychological barrier of $23,000 over the entire period, indicating that the recent price boom will continue in the long run, according to on-chain analytics.
Positive On-Chain Metrics
Bitcoin (BTC) has lost all of the territory it gained at the beginning of February after briefly topping $24,000. Despite the fact that Bitcoin is having problems rebounding to the $24,000 level, bulls have successfully defended the $23,000 level. The realized Bitcoin price and the realized price for both short-term and long-term Bitcoin holders are on-chain measurements that provide a clear sense of whether or not specific segments of the market are profitable or unproductive.
However, now that Bitcoin’s price has surpassed $23,000, market participants in all three categories are no longer in the red. This highlights the significance of this milestone for the numerous crypto market participants. The Bitcoin Market Value to Realized Value (MVRV) indicator is an on-chain indicator that may be used to determine when the price is over or below “fair value” and to calculate market profitability. The MVRV Ratio is now at 1.18, which is very close to one.
MVRV Ratios less than one generally indicate bear market bottoms and the accumulation of prudent money. Given that MVRV is at 1.18, this lends validity to the notion that market participants are actively accumulating and may soon see a new local all-time high. This has caused many to believe that the flagship cryptocurrency’s price will surpass $30K, with a ceiling of $40K.
Is a Bitcoin (BTC) price drop on the way?
Meanwhile, concentrating on monthly timescales, notable crypto trader and analyst Rekt Capital has identified a probable signal for Bitcoin to fall before continuing to rise. This was evidenced by its Relative Strength Index (RSI) rebounding from an all-time low in January to regain a vital support level. While he admitted that historically, Bitcoin markets haven’t seen double bottoms in RSI, he suggested that there is still a chance that a higher low may occur next.
Michael van de Poppe, another crypto expert, has expressed similar sentiments. According to him, a decline for Bitcoin back to the $20K zone is much more possible and makes “a lot of sense”. Although earlier today, Michael maintained his stance on Bitcoin’s positive forecast of $40k, calling it the “Bitcoin to $35-40K season”.
Theoretically speaking, a correction to $20K makes a lot of sense and would be a great buy opportunity for #Bitcoin.
However, most of the people are waiting for this correction to happen, as a large group is sidelined.
In that regard, continuation upwards is max pain.
— Michaël van de Poppe (@CryptoMichNL) February 4, 2023
At the time of writing, the price of Bitcoin (BTC) had risen to $23,444 per coin. And, according to CoinGape’s crypto market tracker, this translates in a 0.33% increase over the last 24 hours, compared to a 2% increase over the last seven days.
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