Renowned crypto enthusiast and analyst Will Clemente put forward a thesis that the main cryptocurrency is undervalued by the market at the moment. In favor of his statement the expert brought a number of interesting arguments.
Clemente pointed to the successful passage of backwardation and the negative financing of BTC futures contracts on cryptocurrency exchanges. Moreover, Bitcoin is starting to build dominance again, as its index reached its lowest value since 2018, bouncing back to around 40% at one point. The analyst also pointed to a number of bullish signals, citing the state of divergences and on-chain metrics as evidence.
Think market is underweight BTC – Several weeks of open interest with negative funding and backwardation engulfed in 1 candle – Successful test of demand in Coinbase orderbook – BTC dominance bouncing off 2018 support – Commodities rolling over, CPI likely lower than expected pic.twitter.com/pisef1hiND
— Will Clemente (@WClementeIII) September 10, 2022
Clemente’s opinion on the more ephemeral signals is the most interesting. Positive statements of heads of major cryptocurrency venues as well as increased circulation of obituaries to Bitcoin in the crypto space clearly indicate that the market has reached the bottom, the expert believes.
Nevertheless, possible doubts still have a place in the issue of the U.S. monetary policy and, in particular, the Fed’s fight against inflation, which directly affects the quotation of cryptocurrencies. According to the analyst on this question, it is worth waiting for a decline in inflation after the series of aggressive rate increases by the regulator.
However, as usual with the Fed, actions and rhetoric can bring a number of surprises, given the unstable macro and geopolitical background in the world.
Bitcoin (BTC) price review
For now, Bitcoin has managed to move beyond the important $21,500 price level. If the price holds until the opening of the U.S. stock market, with the S&P 500 continuing to move to $4,100, a rise can be expected. Otherwise, if the index goes into a correction, Bitcoin will likely go after it. The support levels at the moment are the $20,800-$21,000, $20,500-$20,000 blocks.
There is also speculation in the crypto space that Bitcoin’s slight rise was triggered by a recent interview with Britain’s King, Charles III, who is surprisingly knowledgeable about blockchain and the technology associated with it.