Bitcoin's price broke a new record during the weekend, at $61,700, precisely as predicted on Friday. At the time of this writing, it was trading around $59,900, according to CoinGecko.
Congratulations to all investors and traders who held or accumulated additional bitcoin during these past few weeks' corrections.
However, if we look at the Volume Profile Visible Range (VPVR) on the left, we notice how bitcoin just entered price discovery mode, which means we expect volatility to increase bitcoin's price significantly to rally towards $65,000 and above.
After bitcoin broke a new all-time high in terms of news, everyone became even more bullish on the short-term price action. Adding to that, a significant number of players attributes this recent rally to more institutions entering the space. The BBC wrote that
"Big companies have fueled the recent spikes."
Therefore, we expect bitcoin's price to rise sharply as more companies join the bitcoin space, and its supply becomes scarcer due to the bitcoin halving event.
During this past week, bitcoin's price traded within the predicted range (blue), and as expected, broke $60,000 and found a new record price, above $61,700. While a minor correction is taking place as we write the "Daily Roundup", we expect bitcoin's price to break $65,000 shortly.
We remain bullish on BTC/USD as long as:
- BTC/USD remains above its 20-day MMA (red), 50-day MMA (green), and 200-day MMA
(blue). - BTC/USD doesn't drop below $55,000.
- BTC/USD daily volume goes above its 21-day Moving Average soon.
Traders’ Food For Thoughts
Today's first tweet comes from Ki Young Ju, CEO of Crypto Quant and on-chain analyst.
In his post, Young shares the
"BTC: Coinbase Premium Index" chart, and he highlighted that "Coinbase Premium Index was always significantly high when $BTC price breaking 20k, 30k, 40k, and 50k. It was significantly negative when the price broke 60k."
Interestingly, Ju opens the discussion to who may be buying bitcoin. Could this time be different?
Apparently, according to the on-chain analyst,
"This 60k bull-run is not US institution-driven, it all came from stablecoins."
We would like to also bring to the table the hypothesis that we could be witnessing
crypto-investors who have been waiting for the right time to buy, now entering the space, or instead, these are new institutions and wealthy individuals acquiring bitcoin through stablecoins.
The next post comes from the Twitter handle Jan & Yann, which states that it belongs to the co-founders of Glassnode.
In their post, Jan & Yann share the "Bitcoin: Future Open Interest - All Exchanges". They wrote that
"New ATH in #Bitcoin Futures Open Interest. More fuel for the next leg up."
Essentially, the number of institutional buyers and wealthy individuals betting on bitcoin's future price has increased. The cryptocurrency has broken another record related to how much money is being locked in bitcoin futures.
We think that this data shows these new players who are entering the space are the culprits behind the most recent bitcoin's price rally. Hence, we argue that as long as new money continues to flood the bitcoin market, the price should continue to move up.
The following tweet comes from _Checkmate, an on-chain analyst at Glassnode.
_Checkmate shared the “Bitcoin: Total Miner Revenue Priced in BTC and USD”, which clearly shows an uptrend in the total revenue by miners, both in bitcoin and U.S. dollar terms. As the analyst wrote, it has broken its prior record, reaching “an All-Time High of $52.3M per day.”
_Checkmate also wrote that
“This is despite the BTC issuance dropping post-halving 3 to only ~900BTC/day.”
The trend shows (orange) are a declining miner revenue from the block subsidy, which is currently valued at around 1,000 BTC/day. However, just like _Checkmate stated, the overall miner revenue keeps growing.
Hence, this data shows how a declining block subsidy should not be a problem for the bitcoin economic model. In the long-term, fees should be enough to satisfy miners’ for their hard work.
The last post of the day comes from Dan Tapiero, a legendary global macro investor with over 25 years of experience and the founder of DTAP Capital.
Tapiero shares the
"Global debt (in USD) in % of the GDP". As the macro analyst wrote, "Interest rates cannot go up for any meaningful period given global debt at 355% of Gdp."
Tapiero argues, "bitcoin has a long way to go" since its price will most likely continue to rise. The logic behind Tapiero's argument is that "Debt with unlimited supply at negative real yields provides 0 incentive to own it.", which means that the incentive to hold Debt in the U.S. dollar terms is non-existent. He later adds that "Debt is denominated in fiat currency. Fiat debt devalues vs high yield #btc."
Essentially, Tapiero discusses one of the main reasons for the continuation of the uptrend. The more debt there is, the less valuable currency is. The less value each dollar has, the more dollars one needs to acquire bitcoin.
Therefore, in his opinion, bitcoin's price will continue to appreciate. We completely agree with his logic, and we would like to add that QE measures, which will most likely increase total Debt, should have a positive impact on bitcoin's price, according to Quantum Economics analyst Pedro Febrero.
Bitcoin Price Prediction
At the time of this writing, bitcoin's price is trading close to $59,800. In the past week, it has grown above 20% and broke its prior high.
With the positive news around the recent price action and the current spikes in bitcoin being bought by institutions, most analysts now believe this new rally will move bitcoin toward $65,000 and above.
The likelihood bitcoin's price continues to rise increases every day that it keeps trading above $58,000. The following support level for BTC/USD should be close to its prior high, around $58,200.
How do we think the price will trade today and during the week? As shown in the above chart, we believe that bitcoin could top around $65,000 in the next few days, assuming buyers continue to enter the space. Considering the recent buying volume, that scenario is likely to happen until the end of the week.
On the other hand, we don't expect the cryptocurrency to drop much below $58,000. If it falls, then $55,000 will most likely be the next healthy level of support for bitcoin's price.
To finalize, the VPVR shows a high number of buy orders between $50,000 and $55,000 and that there are almost no sellers left above the current price, at around $60,000, which means BTC/USD should soon break a new high and continue into price discovery mode.
As a reminder, we expect volatility to suffer a sharp increase when bitcoin's price picks up the pace.