Can Bitcoin: USD/BTC (BTC=X) really hit $100k? If so, then when?
The Next Bitcoin Halvening
There’s a clause in the monetary policy of Bitcoin which states that every four years (roughly), the rewards for mining new bitcoins is cut in half. Today miners earn an average of 1800 Bitcoins per day now, which will be cut to 900 Bitcoins in 2020. With less Bitcoin being distributed into the circulating supply and increased demand, the halving may serve as a distinguished price catalyst.
The next Bitcoin halving in May 2020 will be the third halving. The first halving happened in November 2012. Then after 4 years, the second one happened in July 2016. Both halvings were the precedent for a significant wave of Bitcoin acceptance, and a considerable appreciation in Bitcoin’s price was reflected within the following year.
Basic Economics — Supply and Demand
It’s also plausible that speculators may cause a spike in demand prior to the next halving in anticipation of a price increase.
The price of any product is driven by the demand and supply it sees in the open market. Take a look at the combined demand of the BTC across all the markets. The increase in trading volume has a direct relationship with both demand and price rise.
However, while the supply of Bitcoin will decrease, its demand won’t. And as people who are familiar with basic economics might tell, this lopsided relationship between supply and demand will help increase the price of Bitcoin.
Never Underestimate the Effects of Inflation
Today the inflation rate is less than the US dollar and after May 2020 it will be less than that of gold. In 2024 it drops below 1% and then heads toward zero. Bitcoin’s price (in dollars) will continue to rise exponentially as the number of dollars in circulation rises exponentially.
Bitcoin is a “safe haven” asset, like gold, and the price movement of a safe haven asset is different than the price movement of consumable goods.
Safe haven assets have slow, gradual, downward price movements (when economic times are “good”), followed by massive, upward, rocket-ship revaluations higher (when economic times are “bad”); these massive upward price movements (during a crisis) account for the number of dollars that have been printed.
Institutional Trading is Heating Up
There is currently only a bit more than $2B in crypto. There was a large study done by JPMorgan, which found out that every $1B that goes into crypto increases the market cap by $50B.
So, this means that the actual FIAT money that went into crypto over the last few years is only 2% of what the total amount of cryptos are worth and that there is only $2.2B in crypto total right now, because $2.2B * 50 =$110B, that’s what all crypto is currently worth.
At the height of the last bull run, there were around $20B in crypto.
Say Bitcoin reaches a $30,000 price and a $240B market cap, we would probably be at a total $1T market cap.
There is only $20B entering crypto needed this year, since every $1B that enters crypto, increases the market cap by $50B.
BAKKT, Fidelity and ETFs could easily add $10B to this, which would make the crypto market increase by 5x alone.
Add small investors and Bitcoin whales, and we are at $20B and a $1T total market cap again like last year, where we topped out at $800B total crypto market cap.
To reach $100K the market cap will have to be about $2 trillion. This is around one quarter of the market cap of gold and 1/7 of the US money supply. Models based on stock to flow suggest $100K could be reached before 2024.
Germany has always been open to adopt new technological changes as and when it comes. The next wave of demand might come for another cryptocurrency other than bitcoin.
IOTA from Berlin has been partnering up with a lot of Tier 1 and Tier 2 companies for the payment solutions for the self driving car, an interesting area to carefully watch. Some of the major German companies along with Reputable Universities are doing state-of-the-art research to explore other potential applications of Blockchain in the automotive industry.
Overall, the bias in prices is: Downwards.
Note: this chart shows extraordinary price action to the downside.
The projected upper bound is: 7,994.67.
The projected lower bound is: 6,374.77.
The projected closing price is: 7,184.72.
A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 4 white candles and 6 black candles for a net of 2 black candles. During the past 50 bars, there have been 18 white candles and 32 black candles for a net of 14 black candles.
A spinning top occurred (a spinning top is a candle with a small real body). Spinning tops identify a session in which there is little price action (as defined by the difference between the open and the close). During a rally or near new highs, a spinning top can be a sign that prices are losing momentum and the bulls may be in trouble.
Three black candles occurred in the last three days. Although these candles were not big enough to create three black crows, the steady downward pattern is bearish.
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 32.1575. This is not an overbought or oversold reading. The last signal was a sell 10 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 37.03. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 14 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is -129.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -100. The last signal was a buy 15 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 12 period(s) ago.
Rex Takasugi – TD Profile
FOREX BTC= closed down -53.900 at 7,203.100. Volume was 69% below average (consolidating) and Bollinger Bands were 66% narrower than normal.
Open High Low Close Volume___
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 7,344.18 8,215.24 9,375.64
Volatility: 25 63 75
Volume: 89,607 81,443 85,587
Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.
FOREX BTC= is currently 23.2% below its 200-period moving average and is in an downward trend. Volatility is extremely low when compared to the average volatility over the last 10 periods. There is a good possibility that there will be an increase in volatility along with sharp price fluctuations in the near future. Our volume indicators reflect volume flowing into and out of BTC= at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bearish on BTC= and have had this outlook for the last 27 periods.
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