Does Bitcoin have a ‘bullish ace up its sleeve?’
The price of Bitcoin, the world’s largest cryptocurrency, has been in a state of consolidation, which has left many investors pondering if Bitcoin will recover this cycle? If Yes, then when?
The past few weeks witnessed quite a slump on the charts: consider this in April 2021, the price of Bitcoin stood at its all-time high at around $64,000. Whereas, at the time of writing, it was trading at just below the $40k mark. The graph below indicates the downward slope bitcoin had taken.
Will Bitcoin rise?
Irrespective of the bearish sentiment across the market, many analysts have stood firm in their projection over bitcoin’s trajectory.
PlanB, the creator of the popular stock-to-flow Bitcoin model put forward his bullish take and even supported his arguments using his price analysis model. “$288K still in play,” he stated in a recent tweet.
He further added,
“It would really surprise me if bitcoin would not touch the black S2FX model line this phase. Regardless of current volatility, yellow-green and blue dots will be (much) higher than red-orange dots.”
Here’s how the plot looks like as per S2FX model,
The crypto analyst remained steadfastly committed to his previous price projection.
According to the S2F model, it placed Bitcoin on a modest $100,000 average scale. Due to its current downtrend, another analyst stated “It’s a long time since price has been this far below S2F line”.
Another tweet by PlanB addresses the current deviation from the S2F model.
deviation is not much different from 2013 (S2F ~10) or 2017 (S2F ~25), just the usual inertia after a halving
— PlanB (@100trillionUSD) June 12, 2021
So, should you buy the current dip?
With most of the market still bearish about the digital asset, many have questioned if they ought to buy the dip or just stay idle. Alex Kruger, another analyst stated:
For the long term investor bitcoin at $35,000 is cheap.
— Alex Krüger (@krugermacro) June 13, 2021
Following the same thread, he further stated,
“Just play with the odds. What are the odds of 150K in four years, and what are the odds of 10K in four years and so on.”
Mike McGlone, senior commodity strategist at Bloomberg Intelligence in his recent tweet described Bitcoin’s fixed yet declining supply as a “bullish ace”.
“Bitcoin $100,000 has bullish Ace up its sleeve: Declining Supply — This year follows a cut in Bitcoin supply, making the price more likely to appreciate if past patterns hold.”
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