Bitcoin (BTC) has had a rocky start to September, with a decline of 8.16% in the past seven days, according to data from CoinMarketCap. While there have been some signs of recovery in the last day, there is still uncertainty surrounding the BTC market. Analyst Ali Martinez has issued a warning to investors regarding Bitcoin’s potential next movement.
Martinez highlighted the importance of the Realized Price-to-Liveliness Ratio in predicting Bitcoin’s price movement. This ratio is used to evaluate whether BTC is overvalued or undervalued by dividing the Realized Price (the average price at which all Bitcoins in circulation were purchased) by Liveliness (a measure of Bitcoin network activity). Currently, BTC’s Realized Price-to-Liveliness ratio stands at $51,600. Martinez explained that if Bitcoin falls below this level, it could experience significant selling pressure and plummet to its present Realized Price of $31,500.
Bitcoin has seen a turbulent period in September, dropping from $59,000 to below $54,000 in the first week of the month. However, the digital asset has shown some resilience, rising by over 2% to nearly $55,000 on Saturday. Despite this minor price gain, investors should be cautious as September historically has bearish returns for BTC, with an average loss of 4.78% over the last 11 years.
Another crypto analyst, Rekt Capital, has noted that Bitcoin’s sell-side volume is far from its “seller exhaustion levels” amidst recent price declines and increased volatility. This suggests that Bitcoin may experience further price losses before potentially initiating a market rebound. At the time of writing, BTC is trading at $54,009 with a 0.45% gain in the last 24 hours. The daily trading volume has declined by 60.39% and is currently at $19.41 billion. Bitcoin is currently in a strong support zone, and a rebound from this level could drive the asset’s price as high as $60,000, indicating a potential 11% increase from its current price.
Overall, the Bitcoin market is facing uncertainty and volatility, with analysts warning of potential price declines and the need for caution. Investors should closely monitor key metrics like the Realized Price-to-Liveliness Ratio and be prepared for further market fluctuations in the coming days. Despite some signs of recovery, Bitcoin’s price reversal may be delayed, and sellers may still have control over the market in the near term.
