BTC Price Analysis : Will bitcoin hit $38k this week?

Over the past week, Bitcoin shed 4.21% of its value and was trading in the $33k range. While selling pressure has evidently continued to drop for Bitcoin over the past couple of weeks, BTC has hardly picked up any pace in the markets. It remained under $34,000 and hasn’t been able to test the $36,000 range since 29th June. So when would BTC start rallying up again? Well, Bitcoin’s on-chain metrics do provide certain hints.

Reserve Risk indicator which tracks risk-reward balance with respect to the confidence and conviction of long term HODLers, stood at 0.003. It should be noted, a lower reserve risk implies high HODLer confidence. Arguably, at this stage, the risk/reward to invest remains pretty attractive.

In mid-April when the coin hit its ATH, the reserve risk stood at 0.007. In that perspective, the present 0.003 signals a relative undervaluation of Bitcoin. The RR index had peaked during Bitcoin’s rallies in 2013 and 2017, but post that, the coin underwent a strong bearish phase and the RR parallelly shrunk too. The aforementioned comparison suggested that BTC’s price movement has followed the same direction as the RR index.

The fact that this metric is on the fall and hasn’t bottomed out goes on to suggest that the bear run hasn’t concluded and despite the slight respite, a further downtrend can be expected in the coming days.

Another key metric worth considering at this point is Bitcoin’s volatility. The 30-day BTC/USD volatility stood at 4.58% – a level that was previously witnessed in March, days before the coin went on to hit its ATH.If parallels had to be drawn, keeping other factors aside, the coin should likely be able to repeat its April ATH streak in the coming few days. Well, that’s not how the BTC market usually works, right?

Diminishing volatility usually shuts the door for any dramatic price action, and keeping in mind the current sluggishness, the odds of Bitcoin oscillating in its current $30k-$40k range bound region for the next few days remains slightly higher than a complete change in trend.

Additionally, Bitcoin’s MVRV Long/Short difference indicated a key emerging trend. This indicator just dipped below 0% for the first time in 14 months on 10 July. Whenever this long-term indicator veers negative, it implies that a combination of short-term and long-term traders are underwater on their investments.

Thus, this dip postulates that BTC is in the buy zone. On-chain data aggregator platform, Santiment, in one of its latest tweets highlighted, when this occurs, Bitcoin is likely to see an increase in market price.”