PlanB Bitcoin Prediction May 2024

Summary

In this insightful video, the host delves into the Bitcoin market using seven key charts to analyze trends and make predictions. Despite a slight dip this month, Bitcoin remains 36% up year-to-date. The Bitcoin Stock-to-Flow model, which has historically been accurate, suggests a price target of around $500k by 2024 and $100k this year due to the need for mining revenue recovery post-halving. The Market Cycle model indicates that the current bull market is ongoing, with dips of up to 25% considered normal. Technical indicators like the RSI have normalized, and the 200-week moving average provides a conservative floor. The realized price and return metrics offer insights into market support levels and profit-taking behavior. Overall, the video presents a bullish outlook on Bitcoin, suggesting exponential returns until at least 50% adoption is reached.

Takeaways

• 📈 Bitcoin closed the month slightly above $60k, which is $10k below the previous month, but still up 36% year to date.
• 🔍 The Bitcoin Stock-to-Flow model shows an average price of $34,000, slightly below the $55,000 predicted by the 2019 model, but within the same order of magnitude.
• ⏳ This month marks the last 'blue dot' before the countdown to the next Bitcoin halving in 2028 begins.
• 📊 The model suggests that the Bitcoin price will likely catch up to the model value, which is expected to rise after each halving, with the error margin decreasing over time.
• 💰 The presenter predicts that Bitcoin will inevitably reach $100k in 2024 due to the need for mining revenue to recover after the halving, which reduced revenue by 50%.
• 📉 Despite market dips, the Bitcoin Market Cycle model indicates that the bull market is still ongoing, with on-chain transactions signaling its continuation.
• 📌 The RSI (Relative Strength Index) has normalized to 66 after a high of 77, suggesting potential for further price increases in the upcoming months.
• 💹 The 200-week moving average for Bitcoin has increased slightly to $34,000, providing a conservative floor for the price in a bullish market.
• 💰 The realized price of Bitcoin, which is the cost price weighted against the last transacted price, is currently at $29,000, providing a strong support level in the market.
• 📈 The realized return for Bitcoin in April was positive at 7%, indicating that sellers are taking profits, which is typical behavior in a bull market.
• 🔄 Bitcoin in profit has dropped slightly, with 12% of holdings now in loss, which could be compared to similar patterns seen in 2020 and 2012 before the market resumed its upward trend.

Q & A

What is the Bitcoin Stock-to-Flow (S2F) model?

The Bitcoin Stock-to-Flow model is a chart that uses the existing supply of Bitcoin (stock) and the amount of new Bitcoin generated (flow) to predict future price movements. It's based on the concept that the scarcity of Bitcoin, as new coins are produced at a decreasing rate, will drive up its price.

How did Bitcoin perform in the month discussed in the script?

Bitcoin closed the month slightly above $60,000, which was $10,000 below the previous month's close. Despite this, Bitcoin is still up by 36% year to date.

What is the significance of the 'blue dot' in the Bitcoin Stock-to-Flow model?

The 'blue dot' represents the current month in the Bitcoin Stock-to-Flow model. It signifies the last month before the countdown to the next Bitcoin halving event begins, which occurs approximately every four years.

What is the current average price of Bitcoin according to the model?

The current average price of Bitcoin, as calculated by the Stock-to-Flow model, is $34,000.

What is the predicted target price for Bitcoin by 2024 and 2028?

The predicted target price for Bitcoin by 2024 and 2028, according to the updated model parameters, is still around $500,000 on average.

Why is the halving event important in the Bitcoin market?

The halving event is significant because it reduces the rate at which new Bitcoins are created, effectively decreasing the supply. This reduction in supply typically leads to an increase in price, as the scarcity of Bitcoin increases.

What does the 'realized price' of Bitcoin represent?

The 'realized price' of Bitcoin represents the cost price of all Bitcoins in circulation, weighted against their last transacted price. It provides insight into the average selling price of Bitcoin over a given period.

What is the current realized price of Bitcoin?

The current realized price of Bitcoin is $29,000, and the two-year realized price is $45,000.

What does the 'realized return' indicate?

The 'realized return' indicates the profit or loss that sellers are making when they sell their Bitcoins. A positive realized return, like the current 7%, suggests that sellers are taking profits in the market.

What is the current status of the Bitcoin market cycle?

The Bitcoin market cycle, as indicated by the on-chain transactions, is still in a bull market phase, despite recent dips in price.

What is the significance of the Relative Strength Index (RSI) in the context of Bitcoin's market cycle?

The RSI is a technical indicator that measures the speed and change of price movements. In the context of Bitcoin's market cycle, a high RSI, such as above 80, indicates steep price increases and a strong bull market.

What does the 'Bitcoin in profit' metric represent?

The 'Bitcoin in profit' metric represents the percentage of Bitcoin holdings that are currently in profit. A drop in this metric indicates that a portion of Bitcoin holders are experiencing losses, which can influence market sentiment and behavior.