Bitcoin Is Trapped In A Downtrend, But A “Positive Trifecta” Screams “Deep Value”


$20,000 is no longer supported.

$100,000 did not happen.

Bitcoin halving is 562 days a way.

The bears simply refuse to relax their grip on the market and the Federal Reserve’s policy of rising interest rates and quantitative tightening adds fuel to the fire.

Despite these challenges, in a September 15 Twitter space hosted by CointelegraphCapriole Fund founder Charles Edwards explained why he is still bullish on Bitcoin.

Edwards said several on-chain metrics suggest BTC is undervalued:

“I see incredible deep value and I kind of call it a trifecta and that we have three positive things going on in my mind. One is the timing of the cycle, between the second and third year, which has historically been when all Bitcoin cycles bottom out. The second is that we have reached 90% of the draws of the normal cycle. Now obviously all of these things can go down, but that alone is kind of a good value signal. And then third, just the readings on just about every on-chain metric, whether it’s Mayer Multiple, Puell Multiple, NVT, or dormancy, it’s all kind of at a four-year discount. So for me, it’s kind of this once-per-cycle opportunity that we’re seeing right now.

Asked about his thoughts on the previous Bitcoin halving and how the current economic environment will impact the upcoming halving, Edwards said:

“I think it was successful because it placed Bitcoin as one of the toughest assets in the world amid massive money printing. And we’ve seen a lot of old school traditional finance, legendary investors, Druckenmiller, etc. getting into bitcoin because of it, because it’s more or less a hedge. And that kind of sparked the next 6 to 12 month rally. I also think the crypto industry is still operating on bitcoin’s type of halving cycle. For the moment. I don’t think they’ll go on forever, but for now I still think it has some weight and an impact on how people invest in the space. With each subsequent halving, the additional value of lower inflation for bitcoin is negligible because it is already – with the exception of Ethereum – now the hardest asset, or harder than the gold.

2022 proved that managing risk and building a balanced portfolio are still skills that crypto investors strive to develop. Edwards said:

“Whatever your method, however you trade or invest, whether or not you use stop losses as a strategy. You need to do detailed modeling on as much data as possible and not just two years of data, because that’s how entities have exploded in the past Do whatever you can, like 10 years worth of bitcoin at least, and assume the worst, then add a buffer element again below it to manage the size of your position.

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