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Bitcoin Enters “Chop Mode” as Analysts Eye Potential Consolidation Phase

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  • Bitcoin has yet to break above any key resistance levels over the past couple of weeks, with the resistance at $16,000 holding strong
  • The selling pressure here has proven to be significant and has stopped the cryptocurrency’s immense uptrend right in its tracks
  • Where the entire market trends next will likely depend on how Bitcoin trades as it nears this crucial level
  • One prominent trader is stating that he expects Bitcoin to see further chop in the near-term, with this consolidation being more likely than a “deep retrace.”
  • Should this trend play out, this could be highly positive for altcoins, allowing many to further extend their recent momentum

Bitcoin and the aggregated crypto market have seen mixed price action throughout the past few days.

While BTC has formed a large trading range between $14,800 and $15,800, most altcoins are now catching up to the benchmark cryptocurrency’s recent gains.

Its consolidation phase has bolstered its outlook, potentially opening the gates for altcoins to see further momentum in the days and weeks ahead. Ethereum’s strong uptrend has enhanced this possibility.

One trader explained in a recent tweet that he believes further sideways trading is a more likely possibility for Bitcoin than it seeing any sharp retrace in the near-term.

Bitcoin Pushes Higher But Remains Rangebound

At the time of writing, Bitcoin is trading up just over 2% at its current price of $15,650. This is around the price at which it has been trading throughout the past week.

Bulls and bears have formed a relatively wide trading range as of late, which was confirmed earlier this week when BTC’s price rallied to highs of $15,800 before facing a swift rejection that sent it down to $14,800.

It has been trading between these two levels ever since, being unable to gain any decisive momentum.

BTC Likely to See Further Chop as Uptrend Stalls

So long as Bitcoin remains below $16,000, one well-respected trader believes that the cryptocurrency will see further sideways trading.

He spoke about this in a recent tweet, adding that sideways trading is more likely than it seeing a deep retrace.

“Quick update: BTC still in chop mode, no break and hold of resistance yet but i’d imagine that’s more likely than a deep retrace. In the event of a retrace looking at the sub 14k area to fill longs. Just watching for now, no +EV trades here imo.”

Image Courtesy of Flood. Source: BTCUSD on TradingView.

How Bitcoin trends next will likely depend on its reaction to $15,800 and $16,000. A rejection here could confirm that it is in for a prolonged consolidation phase, whereas a break above this level will put a move to all-time highs on the table.

Featured image from Unsplash.
Charts from TradingView.





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PlanB feeling ‘uneasy’ as 41% of his followers tip $100K BTC won’t happen this year

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PlanB, the brainchild behind the Bitcoin stock-to-flow model, has revealed he is feeling “uneasy” about his renowned price predictions due to the recent downtrend in markets.

The stock-to-flow (S2F) model, which has predicted BTC prices with some degree of accuracy over the past two years, has been called into question by some of his followers in a recent Twitter poll.

The anonymous analyst surveyed his followers on June 21 asking them what price they thought BTC would reach by the end of the year. He used the results to compare them to a similar survey in March when market sentiment was overwhelmingly bullish.

Of the 124,595 respondents to the latest poll, 41% thought that BTC prices would remain below $100K by the end of the year, which would invalidate the S2F model. That’s two and a half times the 16% in the previous poll who thought the lazer eyes crowd would be disappointed this year.

PlanB who originally published the price predictor in March 2019, pinned a message admitting that even he feels a little “uneasy” when BTC prices deviate from the model. However, the analyst noted that the model had managed to hold previously in March 2019, again in March 2020 when the pandemic caused a global market meltdown, and once more in September 2020.

Preston Pysh, the founder of The Investors Podcast Network, commented that it was difficult for a model to account for a blizzard of bad news that has accelerated the market downturn.

“You mean your model doesn’t account for 40%+ of mining rigs getting banned & forced to turn-off & relocate to various parts of the world…and with no forward notice to companies/entitles for the extraordinary expense to their heavily denominated BTC treasuries/retained earnings.”

The model is a calculation of a ratio based on the existing supply of Bitcoin against how much is entering circulation. The scarcer the asset becomes due to the four-year halving cycles the higher the price. PlanB’s model predicts an average price of $288K over the next three years.

Related: $288K BTC price ‘still in play’ says PlanB as Bloomberg champions Bitcoin halving

At the time of writing, Bitcoin had gained 2.9% over the past 24 hours to trade at $34,450 according to CoinGecko. The asset is currently 45% down from its all-time high of $64,800 on April 14.





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Bitcoin in uptrend but BTC may never beat gold’s $10T market cap — ex-NYSE head

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Bitcoin (BTC) is on a “lower left to upper right trend” and its volatility should not scare investors, the former head of the New York Stock Exchange says.

In an interview with CNBC on June 23, Thomas Farley revealed long-term convictions about Bitcoin and dismissed concerns over BTC price losses.

Bitcoin: Going up, but not “up only”

Coming a day after CNBC pundit Jim Cramer admitted that he sold his Bitcoin stash, suggesting that BTC/USD was going as low as $10,000, Farley provided some much-needed mainstream bullishness.

“With respect to the recent price moves, I’m kind of sanguine about them — Bitcoin’s a very volatile asset class, in part because it’s a new asset class,” he told the network.

“I have no doubt it’ll go up, it’ll go down over the long term — I still think it’s a lower left to upper right trend and I think we’re going to see that play out over five years.”

With mining upheaval coming from China still on everyone’s lips, popular mainstream criticism of Bitcoin’s energy usage was also swiftly cast aside as a temporary issue.

“I think this kerfuffle is an interesting conversation, but by and large I think it’ll be resolved because I think the blockchain at its core adds to its efficiency and in fact will add to energy efficiency over time,” he continued.

Less convinced on gold. vs. Bitcoin

When it comes to Bitcoin as “digital gold,” however, Farley was more conservative in his predictions.

Now firmly beneath a trillion-dollar market cap, Bitcoin must transform in order to take on store-of-value safe-havens.

Related: Joining the ranks: Bitcoin’s correlation with gold and stocks is growing

“I think the upper bound for now is gold, which is about a $10 trillion market cap,” he added.

“In order for Bitcoin to one day exceed gold, it’ll have to be more of an accepted form of currency — I’m not sure, frankly, if it ever gets there.”

Proponents argue that Bitcoin, by its very nature, faces just a matter of time before eclipsing gold thanks to the latter’s ultimately infinite supply and inability to beat Bitcoin in all aspects of “money.”

The precious metal saw a major sell-off last week after comments on policy from the United States Federal Reserve.

To beat gold, Bitcoin would need to trade at more than $533,000 with the current supply.