Critical Analysis for Bitcoin (BTC): Trading Below Its Value, But No Bullish Signals! Here’s Why

Bitcoin surged above $65,000 after military clashes between the US and Iran eased for a second consecutive day. This also had a positive impact on altcoins, with Ethereum rising over 4% in the last 24 hours to above $1,960, while major altcoins like Solana and XRP gained between 1% and 2%. In contrast, international oil prices fell by approximately 5%.

This will be a critical week for $BTC and altcoins, as the Fed will announce its July interest rate decision on Wednesday.

At this point, whether the uptrend for $BTC will continue depends on future developments, while one analyst noted that $BTC has entered a region below its current value but is still lacking upward momentum.

CryptoQuant analyst Axel Adler stated in an article that Bitcoin’s MVRV Z-Score, a benchmark for valuation, has fallen to a multi-year low but remains above the negative zone.

At this point, the analyst said that Bitcoin has entered a price zone historically considered below its true value, but that the complete capitulation process seen at the lows of previous bear markets has not yet occurred.

According to the analyst, the data shows that the $BTC MVRV Z-Score is currently around 0.42, well below its historical average of 1.7, but has not yet entered negative territory, indicating widespread selling.

In addition, the analyst noted that $BTC’s seven-day realized profit and loss pattern has turned from negative to positive. This indicates a decrease in on-chain selling pressure. However, according to the analyst, this alone is not considered sufficient to confirm the start of a new bull cycle.

In conclusion, analyst Axel Adler noted that while the recovery in profit/loss indicates reduced selling pressure, the MVRV Z-Score has not yet fallen below zero to trigger capitulation selling. According to the analyst, this means Bitcoin is currently closer to an “undervalued stabilization phase” rather than a confirmed cycle bottom.

In conclusion, according to the analyst, for a bottom to form and a sustained uptrend to begin in the market, it is not enough for selling pressure to decrease or for the market to trade below its value. In addition, strong on-chain demand, increased profitability, and aggressive accumulation by long-term investors are necessary.

*This is not investment advice.