They mentioned that during the past week, $5.2 billion worth of BTC and $3.1 billion worth of ETH were moved off exchanges. Historically, this has been a bullish sign as the coins were moved back into cold storage and were not intended to be sold immediately anymore.

Matrixport also shared the following graph for Bitcoin, noting that we will soon see BTC breaking the triangle:

PlanB’s new S2F model suggests a $454k price target for BTC

532k target was based on (original 2019) stock-to-flow model: BTC=0.4*110^3=~532k

The recent refitted S2F model (with 5 years new data since 2019) has similar results: BTC=0.25*122^3=~454k

— PlanB (@100trillionUSD) June 3, 2024

The ‘Stock-to-flow’ is a number that shows how many years, at the current production rate, are required to achieve the current stock. The higher the number, the higher the expected price.

BTC surges in anticipation of ECB’s expected rate cut

With recent drops in inflation, the ECB is predicted to lower its benchmark rates. Money markets suggest a 93% chance of an ECB rate cut in the upcoming monetary policy meeting.

Bitcoin is often seen as a hedge against inflation. If the ECB rate cut raises inflation expectations, it could potentially attract more investment as it is considered “digital gold”.

A double top pattern is formed when an asset’s price reaches a high point, drops, and then rises again to a similar level, creating two distinct peaks separated by a trough. This pattern is considered a reversal signal, suggesting that the upward trend may be losing momentum, and a potential downturn could be on the horizon.

Jelle’s analysis was made when the bitcoin price was hovering around $67,900. Based on the double top formation, he predicted that the price could plummet to $12,000, a staggering 82% decline from the current levels.

Extreme Prediction or Plausible Scenario?

While a drop to $12,000 may seem like an extreme prediction, several factors could contribute to such a drastic downturn. First, the crypto market has been known for its volatility, and substantial price swings are not uncommon. Additionally, the recent surge in bitcoin’s price might have been fueled by speculation and hype, which could potentially lead to a sharp correction.

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However, it’s important to note that Jelle’s prediction contrasts with the prevailing sentiment among many market participants. In recent weeks, there has been a significant influx of capital into bitcoin, with investors anticipating a potential bull run. Moreover, the recent halving event, which reduced the supply of new bitcoins entering the market, has further fueled speculation of an impending price surge.

Cautious Optimism from TradingView Analyst

Another analyst, wt8pcm, whose insights were shared on TradingView, offered a more nuanced perspective on the bitcoin price dynamics. While acknowledging the lack of clear direction in the current market, the analyst identified a trading range between $67,450 and $68,830.

According to the analysis, conservative traders might be better off waiting for a clear breakout before entering a position. However, more aggressive traders could consider selling near the upper resistance level of $68,830 or buying near the lower support level of $67,450.

The analyst provided the following trading suggestions:

1. If the price breaks through $68,830, traders could consider buying, with a target range of $69,500 to $69,800.
2. If the price falls below $67,450, traders could consider selling, with a target range of $67,300 to $67,000.

It’s worth noting that the analyst emphasized the fluid nature of market conditions and the possibility of updating the analysis in their guidance group as the situation evolves.

In a subsequent update, the analyst acknowledged that the price had fallen below the lower limit of the resistance range, suggesting a potential selling opportunity. The target price for this trade was set at $66,700, reflecting a more conservative stance compared to Jelle’s $12,000 prediction.

Which Indicators Show Bullish Signs?

What Does Bitcoin’s MVRV Z Score Indicate?

The Bitcoin MVRV Z score, which compares the current market value to historical averages, generally peaks around 6 during market cycle highs. According to LookIntoBitcoin, the score is presently under half of that and hasn’t exceeded 6 since March 2021, indicating potential for further growth.

Another critical metric, the Puell Multiple, is also yet to reach typical cycle peak levels. This indicator measures the daily value of newly mined Bitcoin against its annual moving average. Post-halving in April, the Puell Multiple dropped below 1 and only reached 2.4 during March 2024’s price surge, far from the peak threshold of 3.

User Insights

The Realized Cap HODL Waves charts from LookIntoBitcoin provide additional bullish signals:

• Reduction in young band peaks indicates decreased selling pressure, suggesting room for further price increases.
• Fewer new Bitcoin holders, who tend to panic sell, are a positive trend for market stability.
• Overall holding patterns indicate long-term confidence in Bitcoin’s value.

Conclusion

In summary, despite recent market consolidation, various blockchain indicators point to the early stages of a new bull market. The unique metrics and dominant market behaviors suggest that the crypto market may soon experience significant growth, with Bitcoin at the forefront.

The Daily Chart

On the daily timeframe, the price has been trapped inside a large descending channel pattern for two months now, failing to break out to either side. Yet, following the recent fake breakout from the lower boundary, the market is seemingly gaining momentum to recover and continue higher.

The Relative Strength Index has been on the rise and is now on the verge of rising above the 50% threshold, meaning that the momentum is shifting bullish. This leaves the midline of the descending channel as the most important resistance element that is keeping the market from rallying once again.

The 4-Hour Chart

Looking at the 4-hour chart, it is evident that the price has been repeatedly testing the $60,000 support level over the recent weeks.

Interestingly, the action seems to be creating an inverse head and shoulders pattern, with the neckline being located at the $63,500 mark. In case this level is broken through, market participants can expect a rally toward the $68K resistance level and even beyond in the short-term.

Bitcoin Short-Term Holder SOPR

Bitcoin’s price has failed to keep up its significant upward momentum and has been going through a gradual correction over the past couple of months. While there could be many reasons for such corrections, profit realization is the most prominent.

This chart demonstrated the STH SOPR, a metric that measures the ratio of the realized profits by short-term holders. Values above one indicate profit-taking, while values below one show losses being realized.

As the chart demonstrates, the STH SOPR has been rapidly dropping over the recent correction, retreating from record highs. This shows that short-term holders have already realized massive profit-taking. With the STH SOPR now hovering around one, the weak hands are likely out of the market, and if there is any time for the beginning of a new rally, it could be now.