ARK Invest ‘neutral to positive’ on Bitcoin price while analysts await capitulation

by · July 5, 2022

Bitcoin (BTC) has a “neutral to positive” outlook despite staying below $ 20,000, according to ARK Investment Management.

In its latest “Bitcoin Monthly” report, the US asset management giant flagged signs that the BTC price action is close to bottom.

Wood: “We are waiting for more capitulation signals”

One of Bitcoin’s most vocal supporters, ARK and CEO, Cathie Wood, has stuck to the BTC exposure as the market continues to fall from all-time highs.

The latest Bitcoin Monthly release confirms this belief, with Wood, analysts and research fellow David Puell suggesting that there is little ground left to cover before BTC / USD reverses.

Down 70% from the all-time high, bitcoin is trading at or below some of the key levels: its 200-week moving average, the overall cost basis of the market (realized price), the cost basis of long-term (LTH) and short-term owners (STH) , and its peak in 2017 “, the report states.

“Trading below these levels is atypical and suggests extremely oversold conditions. Only four times in history has bitcoin traded below the price level relative to these funds.”

As such, most losses should have already come, if history is a guideline. Among indicators that have not yet been seen as absolutely low is the MVRV ratio – the ratio between realized ceilings and the cost basis for units that last for different lengths of time.

“Historically, global bottoms occur when MVRV for short-term holders exceeds MVRV for long-term holders,” explained ARK.

“This condition is not met, which suggests the potential for more disadvantages.”

In general, however, Wood in particular sees little cause for concern as the Bitcoin markets can withstand a macro storm of significant historical proportions.

In the latest edition of ARK’s podcast, “In the Know”, released on July 1, she described the company’s attitude towards BTC as “neutral to positive” overall.

“We are waiting for some more capitulation signals, and of course time will tell on the systemic side here. We have not heard of another stress signal in recent days, so that is good too,” said Wood.

The price decline still tipped to continue

ARK’s position, meanwhile, reflects the position of various market commentators.

Related: ‘Wild ride’ lower for BTC? 5 things to know in Bitcoin this week

As the Cointelegraph continues to report, consensus is building around a drop to around $ 16,000, with the majority of indicators on the chain already at the lowest level, either rarely or never before.

“Historically, the 200-week MA has been a bottom indicator for BTC. In this cycle, things can be a little different,” says popular trader and analyst Rekt Capital told Twitter followers late last week, continue the topic that was touched on by ARK.

“Instead of $ BTC bottoming at 200MA, it could form a macro range below that. Anything below 200MA is likely to represent a peak opportunity.”

The 200-week MA is currently at just over $ 22,550, according to data from Cointelegraph Markets Pro and TradingView, and has never stopped rising.

BTC / USD 1-week light chart (bit stamp) with 200MA. Source: TradingView

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