The world’s largest cryptocurrency by market cap had a terrible year. It is currently less than a quarter of its value of $69,000 in November 2021. It is also trading in the $17,000 range, down 64% since the start of 2022. So where is the bottom for Bitcoin (BTC) and when will it get there?
Why is bottom important in the market?
For those who don’t know, a market bottom is an asset’s lowest price point in a given period. This period can be a day, a month or even a year. However, it is usually a reference to the lowest price of an asset during a market correction or bear run. It is the opposite of a peak, which is the highest price of an asset during a bullish or bull market.
The bottom of the market is the best time to buy an asset and the worst time to sell it. Therefore, knowing when the market will bottom or peak can help traders get nice returns. It will allow them to buy low and sell high, allowing them to make big gains in the bargain. With this in mind, several market experts and analysts are trying their best to predict Bitcoin’s bottom.
“BTC is in the final stages of bottoming out”
Several experts say that Bitcoin is in the final stages of hitting bottom. Charles Edwards, veteran analyst and founder of Capriole Investments, highlights several recent signs that support this view. According to Edwards, BTC adoption is at an all-time high. The number of wallets containing 0.1 to 10 BTC rose to an all-time high of 4.07 million.
Furthermore, Edwards also hinted that BTC is trading below the Bitcoin Cost of Electricity (BEC). BEC stands for the raw cost of electricity used to mine BTC. It is also considered a strong support level as Bitcoin rarely falls below this point. This has only happened four times in the past. Bitcoin skyrocketed every time. Edwards also points to the third-highest selling pressure of Bitcoin miners of all time. In other cases, this metric has risen, with BTC entering an uptrend. He also highlights that wallets (hodlers) holding BTC for more than a year have reached an all-time high. In this context, he says:
We have an all-time high in long-term hodling. Those holding Bitcoin for at least a year now represent 66% of the network, more than ever before. All previous highs of long-term holding are in line with bear market challenges.
“Findings show that Bitcoin (BTC) is undervalued”
Another important indicator that Edwards highlighted is Dynamic Range NVT. The indicator gives us an idea of the value of a network by considering the on-chain transaction flow. Basically, it refers to the ratio of Bitcoin’s market cap to the daily on-chain transaction value. Currently, Bitcoin’s Dynamic Range NVT is green, which could indicate a price bottom.
Edward highlights some other signs and technical indicators. All his findings point to the fact that BTC is currently undervalued. This is a sign that the price has bottomed out. He complements his findings with the fact that BTC prices usually follow a certain pattern between halving events and the current trend is in line with those of previous years. It also makes the following statement:
Finally, it’s not just the data that screams ‘Bitcoin is cheap’, we’re also at the bottom for every previous Bitcoin halving cycle. This is where emotions always hit rock bottom and the best long-term investments are made.
Bottom predictions for Bitcoin
While Edwards believes the bottom of Bitcoin is imminent, another prominent analyst, Willy Woo, says BTC could drop further before bottoming out. In this direction, Woo says, “$12,000 wouldn’t surprise me,” and shares his predictions:
$10,000, I think everybody wants it. That’s why it’s usually not what everyone wants. So $12,000 wouldn’t surprise me, $12,000, $13,000. It can escape from here or fall further. These are very wide-angle indicators. However, it’s probably not a bad time for the dollar cost.
Well-known fund manager and founder of Mobius Capital Partners LLP, Mark Mobius also supports this prediction. cryptocoin.comIn an interview in Singapore on November 28, Mobius said that his next target for Bitcoin is $10,000. Earlier in the month, American entrepreneur, businessman and author Robert Kiyosaki predicted a similar bottom. Also, Kiyosaki noted that there will be an opportunity to buy at the bottom.
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