Originally published on: November 27, 2024
Bitcoin’s valuation metrics are signaling that the current bull market still has room to run, with analysts eyeing a potential target of $146,000 in this cycle. Unlike previous market peaks, there are no signs of overvaluation, suggesting that there is still upward potential for the cryptocurrency.
A recent report from research firm CryptoQuant highlights that new Bitcoin holders are not yet fully invested in the market, with holdings of new investors accounting for just over 50% of the total. This is significantly lower than levels seen during previous market tops in 2017 and 2021, where new investors held over 90% and 80% of the total, respectively.
The slow retail activity in Bitcoin purchases in recent weeks has also contributed to the lower valuation metrics. Retail investors have been reducing their holdings while larger investors, including institutions, have been accumulating more Bitcoin. This shift in market dynamics suggests that institutional players are driving the current accumulation phase.
Institutional investors have been leading the way in Bitcoin purchases, with exchange-traded funds (ETFs) recording record weekly inflows of $3.1 billion in the week ending Nov. 22. This surge in institutional interest comes as the price of Bitcoin reached a record high of $99,655.50, just shy of the $100,000 milestone.
While Bitcoin’s price has since pulled back to around $91,000, analysts believe that the cryptocurrency may still see a 30% correction before surpassing $100,000. CryptoQuant’s bull-bear market cycle indicator has been in the bull area since early November, indicating that Bitcoin is still in a bullish phase.
From a realized price valuation perspective, the top price target for Bitcoin is currently at $146,000. This level has historically acted as a top for Bitcoin’s price in previous cycles, suggesting that there is still room for the price to climb higher.
Overall, Bitcoin’s metrics indicate that the bull market is far from over and that the cryptocurrency still has potential for further highs. Despite potential corrections along the way, the data suggests that Bitcoin has yet to enter the overvalued territory, paving the way for continued growth in the coming months.