Bitcoin undervalued sub-$20K, says new report as BTC mimics 2017 bull run

Bitcoin’s market cap to thermocap ratio is primed to repeat bullish behavior, analysis from Stack Funds says.

Bitcoin (BTC) investors have “not long” to accumulate before a continuation of the bull run past $20,000, a new report says.

Released on Dec. 10, the Weekly Report from Asian crypto fund provider Stack Funds predicts that one indicator in particular will follow historical precedent and propel Bitcoin higher.

Report: You can buy BTC, but “not for long”

According to Slack, the market cap to thermo cap ratio (MCTC) is showing signs of repeating its performance in 2017, the year in which BTC/USD went from under $1,000 to $19,866 on Coinbase.

MCTC takes a snapshot of Bitcoin’s market cap, then divides it by miners’ total revenue since mining began — the thermocap.

As of this week, MCTC is around 17, mimicking mid-2017 and lingering in a position from which it has twice heralded the start of a bull market.

“The ratio is currently sitting at the 17 level, which coincides with its 2019 peak. In addition, the value is adjacent to its 2017 breakout, where it whipsawed around the 20 handle before Bitcoin’s rally materialized,” the report commented.

In its current position, there is thus considerable room for maneuver upwards, which leads Stack to assume that bullish progress will soon continue.

Bitcoin MCTC ratio historical chart. Source: Stack Funds

“Given that the ratio is still at its lower band, we are skewed to believe accumulation opportunities persists, but not for long before the $20,000 price breakout materializes,” it summarized.

$19,400 proves stubborn resistance

Bitcoin has rebounded over the past 24 hours after sudden weakness ended a period of price consolidation to rekindle lows under $18,000.

At press time, BTC/USD circled $18,300, with traders watching for signs of definitive support returning.

As Cointelegraph reported, however, little sign of definitive buyer support above $16,200 is evident from exchange orderbooks, with $20,000 still remaining a make-or-break resistance level.

For Cointelegraph Markets analyst Michaël van de Poppe, $19,400 is the high water mark to watch for real confirmation that the current bearish scenario is over.

“If we want to get this bullishness and attack the all-time high again, I’d want to see a break above this block,” he summarized in an update on Thursday.

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