One of the crypto community’s esteemed analysts believes Bitcoin’s (BTC) price might soar past 6 figures within a year, guided by an age-old, trusted metric.
During one of his recent video discussions, PlanB, a seasoned quantitative analyst, shed light on his insights for his 65,200 YouTube subscribers.
He highlighted that Bitcoin’s relative strength index (RSI), an established tool in financial analyses, is exhibiting trends eerily similar to those seen before significant price leaps. To put it simply, RSI gauges the momentum of a particular asset, offering insights into its potential future movement.
Expanding on this, PlanB says, “It would mean that the RSI is going to rise from here towards the halving. There will be volatility, of course. It won’t be a straight line. Then a bull market in 2024 with an RSI around 90- a little above, a little below it- it doesn’t matter. And then a bear market after that in 2025-2026.”
To derive these conclusions, PlanB leans heavily on the stock-to-flow (S2F) model, aligning it with the foreseen RSI patterns. Initially crafted for commodities like gold and silver, the S2F model offers a perspective on an asset’s price in relation to its available quantity.
Based on this model’s calculations, there’s a strong suggestion that Bitcoin could rise to a commendable $60,000 as it approaches the much-anticipated halving event in April 2024.
This event is pivotal as Bitcoin miners will see their rewards diminish by 50%. Following this milestone, the model forecasts a substantial price uptick, potentially oscillating between a whopping $300,000 to an impressive $500,000.
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Providing clarity, PlanB explains, “For Bitcoin price, it will look like this. So we’re here at the moment at this $30,000 level, stuck for months there. For the scenario that I just showed in RSI, this is the price that belongs to that. So it would rise with volatility towards the halving around the stock-to-flow value of $60,000.”
PlanB added, “And then the bull market really goes on, the second stage of the bull market with FOMO (fear of missing out) and greed, and then in this scenario, it’s a rather conservative bull market that bottoms out or flattens out just below the stock-to-flow value of $500,000. So this averages at $300,000, which is still pretty okay, I would guess. It’s 10x from here.”
To give a snapshot of the current scenario, Bitcoin trades at $28,490, marking a marginal dip of 1.2% from the previous day, according to CoinMarketCap.