QKL123 market analysis | Featured indicators show that Bitcoin price is undervalued (1128)

Abstract: Yesterday, the broader market continued to attack after accumulating shocks. Bitcoin's performance was relatively strong and stood at $ 7,500. It is expected to continue upward in the short term. The MVRV indicator is a characteristic indicator in the field of crypto assets, which shows that the current Bitcoin price is at a significantly underestimated level.

According to QKL123 data statistics, at 13:00 on November 28, 2019, the total market value of the global token market was 1,470.581 billion yuan, with a 24-hour total market value increase or decrease of + 4.74%, with a total turnover of 569.052 billion yuan, and a total turnover change of + 14.10% , Market activity has increased. The Babbitt Composite Index was reported at 10354.30 points, with a 24-hour rise and fall of + 5.04%, reflecting the rapid rebound of the broader market; the Bitcoin Strength Index at 98.080 points, a 24-hour rise and fall of 1.18%, the relative performance of Bitcoin in the entire market has changed Strong; Alternative sentiment index is 32 (previous value 20), market sentiment changed from extreme fear to fear.

Among the top ten crypto assets by market value (excluding USDT), BTC has the largest increase in 24 hours (+ 5.30%), and XLM has the largest decrease in 24 hours (-4.49%). USDT's 24-hour rise and fall was -0.56%. Today's net inflow of funds was 94.946 million yuan, a significant increase from the previous value. USDC's 24-hour rise and fall was -0.34%, and today's net capital inflow was 24.911 million yuan, an increase from the previous value. The USDT over-the-counter discount premium index was reported at 99.99, with a 24-hour change of -0.40%.

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In the past day, the global Google search relative value (peak 75) of Bitcoin has dropped significantly from the previous value (peak 100), which is close to the median value of a month. The top seven countries in terms of popularity are Nigeria (100), Austria (47), Germany (47), Switzerland (43), Netherlands (43), Slovenia (41) and South Africa (41). In the past day, the global Ethereum Google search relative value (peak 67) dropped slightly from the previous value (peak 71). The increase in related queries is related to upbit, which is a crypto asset trading platform based in South Korea.

Analyst perspective:

Yesterday afternoon, Upbit CEO Lee said that at 13: 342,000 ETH was transferred from the hot wallet to the anonymous address beginning with 0xa09, but the specific reason is unknown. At this time, the balance in the anonymous address has not been moved. According to Chengdu Lian'an analysis: "UpBit may be attacked by spear phishing emails, watering holes and other attack methods, and obtaining further PC personnel and even executives' PC permissions to conduct further attacks." It is understood that Upbit has not been hacked before, and its main investors include instant messaging giant Kakao. Afterwards, Upbit promised to use the reserve assets to make up for the 342,000 ETH capital loss. According to previous reports, a new report from Korean accounting firms states that it has 100% solvency.

Bitcoin's MVRV indicator is a relative indicator, which is the market value of Bitcoin divided by Bitcoin's Realized Value, which can reflect the degree to which the market price is undervalued or overvalued. The calculation of market value is the sum of the number of bitcoins on the chain (UTXO or account balance) multiplied by the corresponding "latest market price" to reflect the market value that has been realized on the chain. Realizing market value is a unique indicator (compared to traditional finance) in the field of crypto assets, which measures the opportunity cost of holders in the long term, and the holders of long term are the suppliers in the current market. Therefore, the MVRV ratio can be understood as reflecting the degree of deviation between short-term demand (market value) and long-term supply (realized market value) on the secondary market.

Observing the above chart, we can find that the MVRV ratio has basically maintained between 1-3 in the past ten years, and its peak value is basically consistent with the peak value of the bull and bear market. Moreover, during the two major rounds of Bitcoin, the value at the bottom of the bear market was less than 1 (the price was severely undervalued), and the value was greater than 4 (the price was severely overvalued) near the peak of the bull market. extreme case. In the past year, the Bitcoin MVRV started to fluctuate from around 0.85 in early January and broke through 1 in early April, which confirms the start of a new round of rising prices. After that, with the rapid rise in prices, the MVRV ratio rose to a maximum of 2.57 at the end of June, but then the market experienced a large-scale correction, and the value currently fell to about 1.25. Although no one can be sure at the bottom of the market (there is a possibility of a second dip), it is certain that the current Bitcoin price is already at a level that is significantly underestimated by the market.

First, the spot BTC market

Yesterday, BTC hit a heavy volume of $ 7,500. After hitting a maximum of $ 7,600, the shrinkage was adjusted. Recently, Bitcoin has rebounded strongly, and it is necessary to continue to observe the short-term repair situation of the market, otherwise the risk of the market continuing to test new lows still exists.

Funding side

As of 15:00, BTC's net inflow of funds today was 1,499.0947 million yuan. Among them, the net inflow of oversized orders (1 million yuan or more) was 270,235,777,000 yuan, the net inflows of large orders (between 300,000 yuan and 1 million yuan) were 60,513,200 yuan, and the middle orders (between 50,000 yuan and 300,000 yuan) had net inflows. The inflow was 48,434,800 yuan, and the net inflow of small orders (under 50,000 yuan) was 12,825,700 yuan. The market is consistently bullish, with large single net inflows of funds.

2. Fundamentals

Yesterday, the average hashrate of BTC's entire network was 85.08EH / s, which has picked up from the previous day and is close to a one-month low. Mining is facing losses. Some miners have begun to choose to stop, and the risk of miners stepping on the chain is increased. The number of active addresses on the chain is 8.083 million, an increase from the previous day, close to a one-month high; the on-chain transaction volume was 98.23 million, a decrease from the previous day, and lower than the one-month average; the number of coin days destroyed was 1,162,700 (the historical median), and the Japanese currency The number of days of destruction is high, and there is a certain risk of selling pressure in the short term.

Second, the spot ETH market

For a short period of time, ETH is slightly weaker than BTC. After standing above $ 150, the range is mainly volatile. Recently, the events on Ethereum are relatively concentrated (upbit stolen, Istanbul upgrades, computing power bombs). Recently, there may be some fermentation. Pay attention to risk prevention.

Funding side

As of 15:00, the net inflow of ETH today was 19,387,900 yuan. Among them, the net outflow of oversized orders (1 million yuan or more) was 23.8572 million yuan, the net inflows of large orders (between 300,000 yuan and 1 million yuan) were 41,517,600 yuan, and the middle orders (between 50,000 yuan and 300,000 yuan) were net inflows. The inflow was 75.708 million yuan, and the net inflow of small orders (under 50,000 yuan) was 10.04 billion yuan. The market is too large, with small single net inflows mostly.

2. Fundamentals

Observing the DappRadar statistics, the overall activity of the 24-hour ETH DApp has declined. The number of 24-hour active users of the game application My Crypto Heroes is 2.8k, with a 24-hour change of -10.01%; the number of 24-hour active users of the financial application MakerDAO is 2.6k, with a 24-hour change of + 2.56%.

Third, the spot LTC market

Today, LTC came to a shock near US $ 48, and it was mainly linked with BTC for a short time.

Funding side

As of 15:00, the net outflow of LTC funds today was 23678.33 million yuan. Among them, the net outflow of oversized orders (1 million yuan or more) was 19.8673 million yuan, the net inflows of large orders (between 300,000 yuan and 1 million yuan) were 89.654 yuan, and the middle orders (between 50,000 yuan and 300,000 yuan) had net outflows. 183,833,100 yuan, small orders (below 50,000 yuan) net outflow of 42,248,300 yuan. The market is quite divergent, the main force is short, and the net outflow of most single orders is mostly.

2. Fundamentals

Yesterday, the average network computing power of LTC was 167.82 TH / s, a slight increase from the previous day, close to a one-month low, and close to the low of the year. The monthly average moving downward trended downward. On August 05, the computing power decreased after the block reward was halved. At present, there is no sign of recovery. Although it has not fallen below the low point of the beginning of the year, the risk of treading is greater. The number of active addresses on the LTC chain (57,300) dropped sharply from the previous day and was lower than the one-month average; the number of coin days destroyed was 10.4891 million (smaller historical value), a slight increase from yesterday, and the risk of short-term selling pressure is small.

Fourth, the spot EOS market

After the EOS dropped to 2.48 yesterday, the volume increased slightly, reaching a maximum of $ 2.74. Today, it fluctuated in volume and adjusted for a short time.

Funding side

As of 15:00, EOS's net inflow of funds today was 95.808 million yuan. Among them, the net inflow of oversized orders (1 million yuan or more) was 15.552 million yuan, the net inflows of large orders (between 300,000 yuan and 1 million yuan) were 28.185 million yuan, and the net inflows (between 50,000 yuan and 300,000 yuan) were net. Outflow of 10.66618 million yuan, small single (under 50,000 yuan) net inflow of 62.732 million yuan. The market is consistently high, with small single fund inflows.

2. Fundamentals

According to DappRadar statistics, the overall activity of the 24-hour EOS DApp has declined. The number of 24-hour users of the game EOS Dynasty is 1.3k, which is + 1.18% change from yesterday; the number of 24-hour active users of the trading application Newdex is 812, which is -17.40% from yesterday.

V. Analyst Strategy

1. Long line (1-3 years)

The long-term trend of BTC has begun to deteriorate. If the market rebounds and weakens, those with heavy positions can reduce their positions on rallies, and those without heavy positions can choose to vote. The relative price of BTC of smart contract platform leader ETH, altcoin leader LTC, and DPoS leader EOS is close to the year's low. Those with heavy positions can reduce their positions on high prices, and those without heavy positions can choose fixed investment.

2. Midline (January to March)

Bitcoin has been repaired after it deviated from the 200-day moving average. Those with heavy positions can lighten up on rallies, and those without heavy positions wait and see.

3． Short-term (1-3 days)

The short-term shock continued to advance, backed by support, small positions were low-sucking, high-selling, and stop-loss.

Appendices-Interpretation of Indicators

Babbitt Composite Index

The Babbitt Comprehensive Index (8BTCCI) is composed of the most representative tokens with large scale and good liquidity in the existing global blockchain market, in order to comprehensively reflect the price performance of the entire blockchain token market.

2.Bitcoin Strength Index

The Bitcoin Strength Index (BTCX) reflects the exchange rate of Bitcoin in the entire Token market, and then reflects the strength of Bitcoin in the market. The larger the BTCX index, the stronger Bitcoin is in the Token market.

3.Alternative mood index

The Fear & Greed Index reflects changes in market sentiment. 0 means "extremely scared" and 100 means "extremely greedy." The components of this indicator include: volatility (25%), transaction volume (25%), social media (15%), online questionnaire (15%), market share (10%), and trend (10%).

4.USDT OTC Premium Index

The ChaiNext USDT OTC INDEX index is obtained by dividing the USDT / CNY OTC price by the offshore RMB exchange rate and multiplying by 100. When the index is 100, it means the USDT parity, when the index is greater than 100, it means the USDT premium, and when it is less than 100, it means the USDT discount.

5. Google search trends

This refers to the Google web search data results. The relative search value in the specified time and area: the hottest score is 100, the hottest score is 50, and the insufficient data is 0. Note: The higher the score of a country, the higher the search term in all local search terms, and it does not mean that the absolute search times are greater.

6.Net Funds Inflow (Out)

This indicator reflects the inflow and outflow of funds in the secondary market. By calculating the difference between the inflow and outflow of funds from global trading platforms (excluding false transactions), a positive value indicates a net inflow of funds, and a negative value indicates a net outflow of funds. Among them, the turnover is counted as inflow of funds when rising, and the turnover is counted as outflow when falling.

7.Coin days destroyed

Bitcoin Coindays Destroyed refers to the product of the number of Bitcoins traded on the chain and the number of days that Bitcoins are held. The larger the value, the greater the risk of selling pressure on the secondary market. Classification of the number of days of BTC coin destruction: 100 million or more is the maximum value; 50 million to 100 million is the larger value; 10 million to 50 million is the median value; less than or equal to 10 million is the smaller value value. Classification of the number of days of destruction of LTC coins: a maximum value of 500 million or more; a large value of 100 million to 500 million; a median value of 50 million to 100 million; a smaller value of 50 million or less.

8.Number of active addresses on the chain

The number of active addresses on the chain refers to the number of addresses where transactions have occurred in the on-chain addresses of the blockchain. Under normal circumstances, this indicator can reflect the on-chain activity level of a public chain. Off-chain demand activities such as secondary market transactions and wallet usage will have a greater impact on it.

Note: Crypto assets are high-risk assets. This article is for decision-making reference only and does not constitute investment advice.

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