As a seasoned analyst with over two decades of experience in the financial markets, I must say that predicting the exact top for any asset is a tricky business, even more so with Bitcoin due to its volatility and relatively short history. However, when analyzing models such as the Long-Term Power Law, it’s essential to keep an open mind and consider all possibilities.
A financial expert has shared his prediction that the peak value of Bitcoin might reach approximately $400,000, assuming the current pricing model remains valid.
Bitcoin Long-Term Power Law Could Reveal Possible Location Of Next Top
In his latest article on platform X, analyst Ali Martinez discusses insights from the Long-Term Power Law regarding the possible upcoming peak of Bitcoin. Here, the “Long-Term Power Law” is a pricing model for Bitcoin that was developed by Bitbo.
The model consists of three key components, with the primary one being the “power law,” which is obtained by performing a linear regression on past Bitcoin prices. In simpler terms, this power law serves as a straight-line representation of the relationship between Bitcoin’s price and elapsed time, as pointed out in Bitbo’s description of the model.
The other two lines in the model mirror the power law, but they differ in their placement on the graph. One of these lines is positioned slightly beneath the power law so that Bitcoin’s historical price generally remains above it or occasionally touches it.
In this context, the term “support line” refers to a specific level within the model. Correspondingly, another line determines the maximum price for the cryptocurrency, which we call the “resistance level.
Here’s a visual representation demonstrating the historical progression of Bitcoin’s Long-Term Power Law Trend:
According to the graph, Bitcoin’s current trading price appears to follow a power law pattern. Earlier this year, the asset touched the same line when it reached its record high (ATH), but failed to break through. Despite recent downtrends, Bitcoin remains above the supporting line of this model.
The graph shows that Bitcoin set three of its major tops around the resistance line. However, the 2021 bull run top occurred before the asset could reach the level. Thus, it’s unknown whether or not the current BTC cycle will follow the lead of the earlier three.
According to Martinez’s analysis, if the Bitcoin Long-Term Power Law is valid, we could expect the next market peak to reach approximately $400,000, as he predicts the resistance level will be around this amount by next year.
Regarding the potential timing for Bitcoin’s next cyclical peak, this analyst has previously touched on this topic in another post. They provided the following chart to illustrate Bitcoin’s historical price trends over recent cycles.
According to Martinez, if the pattern of the past two Bitcoin cycles holds true, we might reach a market peak approximately one year from now, around October 2025.
BTC Price
Over the past couple of days, Bitcoin’s trajectory appears to be horizontal rather than upward or downward, with its value hovering near the $63,200 level.
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2024-09-25 13:16