At the start of a new week, Bitcoin (BTC) is looking unstable, with $60,000 still out of reach — could this shift in the coming days? Bitcoin is sticking to the mid-$50,000 range after an ordinary weekend that failed to produce the breakout that many had hoped for.
Five variables that can help influence future price success are examined by Cointelegraph.
Coinbase IPO a beacon in flat macro sea
Stock markets were unimpressive on Monday, April 5 with many Asian markets closed for public holidays and United States futures seeing little movement.
Following the Suez Canal debacle, oil was the only commodity with noticeable energy as a decision from OPEC+ countries to increase supply put pressure on prices.
With a lack of momentum available, Bitcoin, therefore, had little to sustain any macro-influenced price run, and $60,000 resistance remained in place at the time of writing.
One major event that crypto analysts are eagerly waiting for, however, is Coinbase’s IPO set for April 14.
As Cointelegraph reported, the event is a milestone for the industry but could be accompanied by selling on launch day — a practice seen with other IPOs both old and new.
Elsewhere, U.S. bond yield rises remained a worry this week with their upward trajectory coinciding with a lack of progress for safe havens more widely.
“The repricing of inflation risk and U.S. rates, which will impact discount rates of future earnings and the way stocks are being valued is a source of uncertainty,” Johanna Chua, chief economist for Citigroup Global Markets, told Bloomberg.
“The other uncertainty is the pace of the vaccinations and the virus.”
Analyst: Bitcoin is at the “$3-5K stage” of 2021 bull run
Bitcoin may be struggling for new support, but hodlers need to zoom out for the real picture.
That was the mood among analysts on Monday as BTC/USD headed lower toward $56,000.
After failing to break through $60,000 late Friday, bearish movements took over over the weekend, resulting in a drop to $56,500.
The rebound after that was muted, with $57,000 serving as a temporary focal point at the time of publishing.
The support resistance battle is intense,” on-chain data service Whalemap added about current behavior on Sunday.
“Levels from last week are working pretty well. Bitcoin is being capped by the $60,045 level pretty spot on. Is this the calm before the storm?”
For popular Twitter analyst William Clemente, however, there was little reason to be bearish on longer timeframes, which have the support of a tranche of positive on-chain data.
“This Bitcoin Bull Run is still far from overheated on multiple on-chain indicators,” he summarized.
“In comparison to 2017, it appears we’re around the $3k-5k range.”
Clemente posted a chart using the Puell Multiple to compare Bitcoin’s price peaks in 2013 and 2017. The Puell Multiple is a classic indicator that continues to suggest that there is space for more growth before a profit-taking sell-off can begin.
Given the early stage of the bull market, the bulk of Bitcoin’s upward price performance is yet to come, which lends credence to some of the high-profile predictions.
No one’s selling
On the topic of miner selling, this is a habit yet to reappear this month.
Despite Bitcoin lingering near all-time highs alongside record network hash rate and mining difficulty, there is no appetite to take profit on mined coins yet, data shows.
Compiled by on-chain monitoring resource Glassnode, the miner net position change has signalled miners retaining their newly-acquired coins over the past week.
By contrast, 2021 has been broadly marked by sell-offs, particularly in January as Bitcoin hit $40,000 for the first time. Sales have come to a halt since, however, regardless of continued — albeit slower — price gains.
“Still not selling, still accumulating, clear trend,” quant analyst Lex Moskovski commented on the Glassnode numbers.
Exchanges are following in the footsteps of miners, with their BTC balances continuing to fall. Traders, on the other hand, have little interest in selling near $60,000 any more than anyone else.
Purpose ETF nears 17,000 BTC holdings
Conspicuously bullish this month are institutions — and they are putting their money where their mouth is, the latest figures say.
With open interest in Bitcoin futures markets near all-time highs, institution-grade products continue to see huge demand — albeit if the price is right.
As such, the first licensed Bitcoin exchange-traded fund (ETF) in Canada, the Purpose Bitcoin ETF, keeps adding BTC in step with its assets under management (AUM).
As of April 5, Purpose held 16,462 BTC and $22.1 billion CAD ($17.56 billion USD) in AUM, having only launched its ETF two months ago.
According to Cointelegraph, the United States is likely to follow Canada in enabling an ETF to enter the market, with such a product expected to attract multiples of what Purpose has been able to attract from institutions in its home jurisdiction.
All of this, however, could come at the cost of Grayscale and its Grayscale Bitcoin Confidence, a stalwart institutional player (GBTC).
GBTC could be losing interest in the more cost-effective Reason, which is one of several Bitcoin products that undercut the company’s management costs to clients.
Time to channel “situational awareness”
The famous stock-to-flow price forecasting model remains on target for $288,000 and higher, demonstrating that the mantra of “the longer the view, the better” remains true for Bitcoiners.
The model’s “bull/bear recognition signal,” as noted by its founder, quant analyst PlanB on Sunday, is casually repeating its movements from 2013 and 2017.
Short-term rumination below $60,000 did not invalidate the model, according to an accompanying map, which showed BTC/USD spot price following its expected trajectory.
Stock-to-flow cross-asset (S2FX) was the incarnation of stock-to-flow used, a modified version that positions Bitcoin in the background of other macro assets and monitors its transformation into a new standard.
“My favorite chart for Situational Awareness,” PlanB wrote in comments.
“S2FX for rough long term level forecast (white line), combined with accurate on-chain bull/bear recognition signal (color overlay).”
By the end of 2021, S2FX expects a price of $288,000, forming an average price in the current halving period, which will end in April 2024. According to PlanB, the price peak until then could be twice the average, or $576,000.