Los Angeles, California – Bitcoin’s recent drop below $63,400 has stirred up Fear, Uncertainty, and Doubt (FUD) in the market, leading to an increase in calls to sell the cryptocurrency. Traders’ sentiment over the past 12-24 hours has shown a notable shift towards selling rather than buying the dip, contrasting with previous bullish calls triggered by price dips.
Despite the negative sentiment, there is a silver lining for Bitcoin as a peak in FUD could potentially spark a rebound in the charts. A recent example of this occurred on April 21 when Bitcoin’s price dropped to $64,531, prompting expectations of further decline. However, the cryptocurrency defied expectations by rebounding to $67,169 shortly after.
Considering market metrics, the Market Value to Realized Value (MVRV) Z Score for Bitcoin currently stands at 2.32. Analysis shows that the price has historically rebounded each time the metric fell below 2.60 since March. This indicates that Bitcoin may be undervalued and poised for a potential uptrend to $68,600 if bears maintain control.
Another metric under scrutiny is the Pi Cycle Top indicator, which historically identifies when Bitcoin is reaching overheated levels. The indicator’s current state shows the 111-day Simple Moving Average (SMA) remaining below the 350-day SMA, suggesting that Bitcoin has not yet peaked. This bodes well for Bitcoin bulls both in the short term and potentially amidst the ongoing cycle.
Looking ahead, if the Pi Cycle Top indicator continues to hold its position in the months to come, Bitcoin could see a possible rally towards $80,000 to $85,000. This projection offers hope for investors anticipating a bullish run in the cryptocurrency market.