There is certainly no shortage of Bitcoin price predictions to be found. There are seemingly endless data points and different things to look at. Prior price movement, macro environment risks, social risk like twitter mentions and Youtube subscribers. Moving averages, Stock to Flow Ratio, prior ROI's, RSI, MACD, Golden/Death crosses. And that's not even getting into the on-chain stuff which looks at actual transaction on the blockchain, what miners and exchanges are up to. You can do technical analysis for pretty much as long as you want. So I generally don't throw my hat into that ring too much. I love Bitcoin for my own personal reasons, largely dealing with how corrupt and stupid and evil the current system of money printing and its ensuing inflation is. Which is a big, round about way of transferring wealth from people with assets and 'suction to the system' to people without it. Inflation is literally no different than someone reaching into your pocket and taking your money. But it's so embedded into our system that people are just used to it now, which apart from being incredibly evil, is exactly how regimes collapse.
Because Bitcoin solves this problem (among others), it is incredibly valuable for preserving wealth. The fact that it also can act as a currency is just a bonus in my opinion. You don't see people pay for things in gold bars, yet we all agree gold has value. No one pays for anything with a building, but we all agree that a building has value. Anyway, the dollar value of Bitcoin has gone from $.07 in 2010 to about $70k in 2024. That is a 1,000,000% increase. A one million percent increase in price in roughly 14 years. So I usually think price predictions are largely useless. It's volatile and the swings can be big, but just zoom out and you'll see that all it does is go up. (By the way, volatility in any asset largely is a good thing. It means it's alive. People are using it, buying and selling, trading it back and forth. Don't be afraid of volatility.)
Since we have a nice little surprise snow day here in the Northeast, I have a little time to myself and decided to do some back of the envelope math and come up with my own little price prediction. The metric I'll be using is from Ben Cowens Into The Cryptoverse Premium: BTC Logarithmic Regression Bands. It won't let me share a picture of the chart, but here's a link to a video of him explaining it 2 years ago with the chart up on the screen. https://www.youtube.com/watch?v=NI1tFhop8Do&ab_channel=BenjaminCowen
So click on that and have it up in a second window as you read this. The green bar on the bottom is fit to thousands of data points and is "non bubble data". The red bar on the top is only fit to a few data points and is fit to "bubble data". The price on the left up and down axis is on a log scale, so it goes from .$01 to $1,000,000, but $1k is the middle. (If you don't already, you should read up and understand log vs linear scales if you want to understand charts like this a better. I know that helped me a bunch). The chart I have is similar to the one in the video except it's up to date and instead of solid green and red bars, there are three green lines and two red lines. If you look at that chart, you can see that since its inception, Bitcoin spends a good chunk of its life in those green 'accumulation' phases where it still goes up, just slower, and then blasts off until it hits a blow off top somewhere in that upper red band region, or right up against it. You can super zoom in on any portion of it of my chart, so I thought it would be good to know exactly how many days we've spent in the green portions in each cycle.
I measured the days in each cycle starting from where the price entered the green zone and ending when it left the green zone and had a blow off top to the red zone. July 2019 was the only time it left the green zone and came back into it without having that red, blow off top until it left the green zone again in November 2020 and hit the red zone a few months later.
Going back to the very start of Bitcoin puts us at July 7th, 2010 when it came onto the scene squarely in the green zone. It bounced out of it briefly, came back down to the very top of it, then took off to its blow off top of $25 right under the red zone. It was in the green zone from July 7th 2010 to April 12th, 2011. 264 days.
It came back down into the green zone on November 15th 2011, and then took off towards the middle of the red zone on February 13th, 2013 for a local top of about $800. 455 days in the green.
It stayed hot until March 16th, 2015 when it came back into the green accumulation zone and stayed in it until May 11th, 2017 when it broke out. 786 days.
This time is went all the way to the top of the red zone with a local top of about $17k, then came back into the green zone on November 20th, 2018. It stayed in the green until July 2019 where it poked its head out for about 3 months, then came back into the green. The next time it broke out, November 16 2020, it went to the very bottom of the red range, bouncing off it almost perfectly with a local top of about 55k. The time from when it first entered the green and had its real bounce out to the red 55k was 726 days.
We re-entered the green zone on May 9th, 2022, and we've been in or under it ever since. Right now, April 4th 2024, we are just under the very top of the green zone. So we've been in the green for 696 days so far.
So here are 'our days in the green to a breakout to the red' since Bitcoins inception: 264, 455, 786, 726, 696 plus. Going from 264 to 455 is a 72% move. Going from 455 to 786 is also a 73% move, almost exactly. But then you go from 786 to 726. It goes backwards. Now we're at 696 and counting.
There's a few different ways to look at that. First off, it's only 5 data points so it might not mean anything predictive at all. But if assume for a minute that it is meaningful, the way I see it that we sort of 'leveled off' our time in the green. It had a short period at first and then grew incrementally all the way up to 786 days. Now we might be coming down the other way a bit. I'll be very interested in what this next number comes in at, which we won't know for a while since the price needs to hit or come close to the red area for confirmation. If it ends up being 786, that would be exactly 90 days from today. To me, that feels like the max it could be. I can't imagine we spend more time in the green this cycle than ever before but of course I could be wrong. If we take an average of the four numbers, it would be 558, which was 138 days ago.
Either way, it looks incredibly bullish to me. Like I said in my last post, even though it might feel like we're a little heated right now, we're still very much in the green accumulation zone. And sure there could easily be another pullback, but I think there is no chance we don't get a push to at least close to the red zone this cycle, if not further.
And now we get to the meat of the matter. What price is the red zone? Right now, the very bottom of the red zone is 190k. If we move it out 90 days, the bottom of the red zone is 200k. So I think we might actually touch 200k this cycle. We've spent just enough time in the green zone, we're almost poking out of it, and except for a couple small instances, every time we leave the green zone we don't stop going up until we hit the red zone (or come extremely close). Even if I'm half right, that puts us at 100k pretty easily.
So my official low confidence prediction: BTC hits 100k this year and tops out somewhere around 200k in late 2024, early 2025. We'll check back on this post in 6 months and see how I did.
That's it for today. Buy Bitcoin, store it yourself and have a good day!
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