Bitcoin (BTC) used over three weeks in the $ 30,000 series turns out to be a critical test of one of the more well-known price patterns.
As Philip Swift, co-founder of the trading group Decentrader, noted on Thursday, Bitcoin poses a major challenge for a tool for predicting stock prices.
Is it time for the bitcoin price to bounce back?
The BTC price movement has been hovering in the lower corridor between $ 30,000 and $ 40,000 since mid-May. This made intraday traders uneasy while bulls called for calm and a long-term mentality.
As the Cointelegraph reports, the stock-to-power model continues to account for this behavior, even though it estimates that the BTC / USD value is close to $ 70,000.
However, the creator, Plan B, expressed concern about the future. If current levels persist for an extended period of time, his pattern may be canceled for the first time in history.
Emphasizes the difference in spot price between average stocks and flows, Swift explained that this has happened before. Each time, Bitcoin jumped off a certain price level relative to the average stock flow, eventually reaching record highs.
“It’s been a long time since the price was much lower than the S2F series,” he told his Twitter followers.
The divergence oscillator is marked with an orange dotted line at the bottom of the chart, and the arrows show comparable historical periods. The Bitcoin price has recovered strongly from this previous deviation. ”
Bitcoin stock-to-power ratio model with extreme divergence limits highlighted. Source: Philip Swift / Twitter
PlanB assesses moving averages
PlanB previously suggested that this year’s bitcoin bull cycle is more like 2013 than 2017, thanks to the correctness of the price drop in May.
Both 2013 and 2017 finally saw a two-part record. The first peak in each case was followed by a significant fall, then it changed to generate a race to a new peak.
PlanB still estimates that it will be $ 100,000 per bitcoin this year, while the stock flow requires $ 100,000 or $ 288,000 on average from now until 2024
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Earlier this week, he named the two major moving averages (DMAs) as a potential launch pad for recovery in the coming months.
“If the June close is $ 54,000 (or higher), and July, August also $ 54,000 (or higher), 50DMA will bounce off 200DMA and remain above 200DMA,” he tweeted.
“So a short short squeeze and a V-shaped rebound to $ 54,000 (+ 69%) will then trigger a rebound scenario.”