A new report looking at chain activity says Bitcoin (BTC) is now due to a bullish phase based on supply movements.
Released by asset manager Stack Funds on July 2, the findings suggest that the 90-day asset supply is dictating a bullish potential for BTC / USD.
BTC price will rise “sooner rather than later”
In publishing an accompanying chart for the metric, Stack argued that it has important implications for historical price behavior.
“The data provides an indication of two folds. Firstly, 90% of Bitcoin’s active supply has shrunk in the past 3 years, from 36% to 17%, suggesting that the investor time horizon has lengthened as Bitcoin holds for longer periods. long in their wallets, ”says the report.
Second, prior to the 2017 and 2019 bull run, where Bitcoin peaked at $ 20,000 and $ 14,000 against the dollar, there was evidence of sharp increases in active supply of 90% (represented in green zones) “
The trend has appeared since Bitcoin’s price drop in March, an event that turned out to be a watershed moment for traders.
Pila concluded:
“As statistics have shown, a potential increase in Bitcoin prices can be expected, which has not yet materialized, leading us to believe that the previous increase in Bitcoin prices could occur sooner rather than later.”
3-Year Chart of Active Bitcoin Supply for 3 Days. Source: Stack Funds
BTC price should be “closer to $ 12,000”
Stack comes immediately after a highly optimistic report by Bloomberg, which last month noted that price performance exceeded $ 12,000.
The current price behavior around $ 9,000 is “compression” for Bloomberg, and a reaction should come in the form of short-term gains.
“Volatility should continue to decline as Bitcoin extends its transition to the highly speculative asset gold crypto equivalent, but we expect the recent compression to be resolved through higher prices,” analysts summarized.
While many indicators are encouraging, demand is clearly bullish. This, the report continues, is also the “most important” category for earning Bitcoin.
As such, Bloomberg joins several others, including Cointelegraph Markets analyst Michaël van de Poppe, in forecasting a possible $ 12,000 target price.
“The increase in addresses used, the inflows of investment products on the stock market and the open interest in futures create firmer bases for benchmark crypto,” he says.
“The number of active Bitcoin addresses used, a key sign of the 2018 price drop and 2019 recovery, suggests a value closer to $ 12,000, based on historical patterns.”
Bollinger Bands Forecast Volatility
Beyond that level, the bullish potential in no way fades. In a technical forecast, Bloomberg describes Bitcoin as a “caged bull” that can reach even higher levels.
“Around $ 8,000- $ 10,000 is the main consolidation range,” he explains.
“We see Bitcoin, at about $ 9,200 on June 25, as it is more likely to approach the 2019 peak close of just under $ 13,000 to keep below $ 8,000.”
A classic indicator, Bollinger Bands, points to a breakout “soon.” Historically accurate for recording volatility in either direction, the bands have shown a characteristic narrowing in recent weeks, a key precursor to further price movements.
6 month BTC / USD chart showing Bollinger Bands. Source: TradingView
Last month, its creator, John Bollinger, weighed in on BTC / USD, warning against optimism for a rise of more than $ 10,000.
