Why bitcoin is significantly overvalued (for now)
By using logarithmic charts we can effectively measure how big a spike was a few years ago compared to now, and by using Elliot wave theory we can make an educated guess on where the markets will go.
If we take a look at where bitcoin is now, and where the big long blue trend line that acts as bitcoins support, we can see that the distance between the price and trendline is -36.39%, in my own opinion bitcoin was seriously overvalued and the price should be sitting at around 4k, theoretically if bitcoin followed this blue trend line we shouldn't have reached 20k until 2020, 20k came 784 days too early and as happened with the first wave spike, the price corrected back to the blue trend line which makes me think that this will happen again with our most recent bullrun to 20k,
Is this healthy? Yes, this would be healthy as the blue trendline is slanted upwards and if the price hugs this trendline, would reach a million by 2024, but seeing how bitcoin always likes to separate from the trend line we could see a million alot earlier as we did with 20k.
I see a very positive future for cryptocurrencies especially bitcoin if it remains the main currency standard for crypto, i.e like USD.
If we take a look at where bitcoin is now, and where the big long blue trend line that acts as bitcoins support, we can see that the distance between the price and trendline is -36.39%, in my own opinion bitcoin was seriously overvalued and the price should be sitting at around 4k, theoretically if bitcoin followed this blue trend line we shouldn't have reached 20k until 2020, 20k came 784 days too early and as happened with the first wave spike, the price corrected back to the blue trend line which makes me think that this will happen again with our most recent bullrun to 20k,
Is this healthy? Yes, this would be healthy as the blue trendline is slanted upwards and if the price hugs this trendline, would reach a million by 2024, but seeing how bitcoin always likes to separate from the trend line we could see a million alot earlier as we did with 20k.
I see a very positive future for cryptocurrencies especially bitcoin if it remains the main currency standard for crypto, i.e like USD.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.