Cryptocurrency News

Bitcoin price reaches stock-to-flow rebound level not seen since 2017 all-time high


bitcoin (B T c) spending more than three weeks in the $30,000 range is proving to be a significant test for one of its best-known value models.

as famous By Philip Swift, co-founder of the trading suite DecentTrader on June 11th, bitcoin is issuing a major challenge to the stock-to-flow price forecasting tool.

Is it Time for a Bounceback for BTC Price?

BTC price action has been hovering in the lower corridor between $30,000 and $40,000 since mid-May. This has worried day traders, while the older bulls have called for a calm and long-term mindset.

as Cointelegraph Reported, the stock-to-flow model continues to accommodate such behavior even though its estimate calls for a BTC/USD price near $70,000.

Its creator, PlanB, still expressed concerns over the future. If current levels remain in place for a longer period, they risk being invalidated for the first time in the model’s history.

Highlighting the spot price divergence from the stock-to-flow average, Swift pointed out that such instances have actually happened before. Each time, bitcoin bounces off a given price point relative to the stock-to-flow average and eventually hits new all-time highs.

“It is a long time that the price is far below the S2F line,” he told Twitter followers.

“The divergence oscillator at the bottom of the chart is highlighted by orange dotted lines and arrows to show comparable historical periods. Bitcoin price has been hit hard by such divergence before.”

Bitcoin stock-to-flow model with divergence extremes highlighted. Source: Philip Swift/Twitter

PlanB Eyes Moving Average

First, PlanB suggested This year’s bitcoin bull cycle is more reminiscent of 2013 than 2017 because of the reality of the May price drop.

Both 2013 and 2017 eventually saw a two-legged run at an all-time high. After the first peak there was a significant drop in each instance, which then reversed to form a run at a new top.

PlanB still believes that this year will see $100,000 per bitcoin, while the stock-to-flow call is averaging $100,000 or $288,000 between now and 2024.

related: Bitcoin Drops Below $36K as Centuries-Old Financial Model Predicts Big BTC Crash

Earlier this week, he referred to two major day moving averages (DMAs) as potential launchpads for recovery in the coming months.

“If the June close is $54K (or higher) and the July-August also $54K (or higher), the 50DMA will bounce off the 200DMA and stay above the 200DMA,” he said. tweeted.

“So a nice short squeeze and a V-shaped bounce back to $54K (+69%) would result in a back again scenario.”

BTC/USD 200-day, 50-day moving average, relative strength index (RSI) and halving for months. Source: PlanB/Twitter