Bitcoin Valuation Indicator Shows BTC is the Cheapest Since FTX Crisis, Analysts Advise Potential Buying Opportunity

• Bitcoin’s valuation indicator suggests that it hasn’t been this affordable since the FTX crisis.
• On-Chain College recently noted this on August 7, referencing the Bitcoin Mayer Multiple chart.
• “If you believe Bitcoin will be higher in the next 6-12 months, now is a great time to buy,” the post stated.

Discover why Bitcoin is currently deemed undervalued and what this means for future investments.

Bitcoin’s Current Valuation

The Bitcoin Mayer Multiple compares Bitcoin’s current price to its 200-day moving average, serving as an indicator for buying or selling signals. Originally devised by Trace Mayer, a value below 2.4 is considered a “buy” zone. As of August 5, Glassnode reported that the Mayer Multiple was valued at 0.88 when Bitcoin dropped to $49,751. Recent data from BitBo indicates a slight increase to 0.93.

Continued Downward Movements

Despite the Mayer Multiple’s optimistic signs, certain analysts continue to warn of downward movements. 10x Research’s Head, Markus Thielen, stated on August 6, “We believe Bitcoin needs to reach $40,000 to mark the start of a bull market.” This sentiment was echoed by prominent crypto personality “wallstreetbets,” who emphasized the importance of buying Bitcoin at its deserved price in a post on August 6.

Future Outlook for Bitcoin

Analysts are optimistic about Bitcoin’s future, particularly post-halving. Many believe there will be significant value appreciation, with the Mayer Multiple suggesting that Bitcoin’s value is currently suppressed. This is evident as the metric typically climbs by 70% post-halving.

Potential Resistance and Support Levels

Crypto trader Mags commented, “If $60,000 support is lost on a weekly close, we could see a retest of the long-term trendline support before moving higher.” This highlights the potential for further dips before a substantial rally.

Conclusion

In summary, while Bitcoin appears undervalued based on the Mayer Multiple, caution is still advised as it may face short-term downward pressures. Investors are reminded to conduct their own research and consider the inherent risks involved in the volatile crypto market.