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PlanB, the well-known creator of the disputed stock-to-flow (S2F) model, believes Bitcoin (BTC) is now on track to hit $ 100,000 as the price has soared to annual highs. The optimistic sentiment coincides with the shift in momentum from alternative cryptocurrencies, or altcoins, to BTC.
He She said:
“I can’t create a chart for you now (at sea), but the S2F model is perfectly on track.”
At the same time, the price of Bitcoin rose 17% this week, as it broke through an important three-year trend line. As Cointelegraph reported, traders apparently expect BTC to test higher resistance levels in the short term.
Bitcoin price rises above $ 11,700 in a rapid intraday rally. Source: TradingView.com
The data shows that it may be time for Bitcoin to shine
Altcoin has dropped particularly in the past 72 hours as Bitcoin’s price started to rise. Ethereum’s Ether (ETH) moved in tandem with BTC during the rally but plummeted against BTC in the past couple of days.
In the short term, as Bitcoin sees a rally in profit taking from altcoins, some investors expect BTC to outperform altcoins. Kelvin Koh, the co-founder of Asia-based venture capital firm Spartan Group, She said:
“If BTC breaks the resistance at $ 11.4K, we will break out of $ 12K in no time. It will pick up the wind from the alt again in the short term.”
The pattern of a Bitcoin rally after a strong altcoin season is not new. In previous cycles, the higher cryptocurrency has typically seen a strong bullish trend after altcoins initially gained against BTC. Such a trend materializes as investors seek safer options, such as BTC, when the altcoin market heats up.
More recently, retail investors’ fear of losing, or FOMO, around DeFi has caused small-cap tokens to rise significantly. In the early days of the DeFi market craze, for example, Compound (COMP) saw a big rally. Then, smaller tokens followed, including Yearn Finance (YFI), Synthetix Network (SNX), and Aave (LEND).
Eventually, when small tokens saw price spikes five to ten times, investors started profiting. The sudden withdrawal of DeFi tokens coincided with a rally in BTC as momentum returned to Bitcoin.
Traders say the trend is still growing
Skew data shows that tens of millions of dollars’ worth of short-term contracts are still being liquidated. It indicates that a relatively large number of investors are betting against BTC in the short term.
Settlements of Bitcoin on BitMEX. Source: Skew
Cryptocurrency trader Cantering Clark said that while he understands why shorts are compelling, the upward trend is too strong. He She said:
“Looking at exchanges from R: R’s point of view is good, but understanding the context is superior. After a major contextual change like this, you can assume your shorts have a lower chance of resolving successfully. Bets should be strong and always present. “
For some traders, a short versus Bitcoin might be attractive because BTC has risen rapidly over the past week and is testing important resistance levels.
A 17% rally in six days, even during a bull market, is substantial, even for Bitcoin. But when BTC’s trend is overwhelmingly bullish, a short squeeze could only add more rocket fuel.
In the past 12 hours, for example, shorts worth more than $ 23 million have been cleared, as the price reached $ 11,750. Therefore, during a strong upward trend in prices, shorts could indirectly catalyze a larger rally.
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