Nicholas Merten Explains Why Bitcoin Is Unlikely To Fall Down To $30K Level
Nicholas Merten, a prominent crypto market analyst, projects that Bitcoin (BTC) will not fall down to July 2021 levels.
In a recent video session, the analyst shared with the 515K subscribers to his YouTube channel that despite Bitcoin might drop further, it’s not likely to fall to $30K levels.
“The big question that a lot of people have in their minds is whether or not this is going to go all the way back down and see some calamity, some crazy sell-off, down to the $30,000 range.
And I’m going to be honest with you all – all the while it’s not to say we couldn’t pull back maybe another $1,000 or so in price – I do not think we’re going down to that $30,000 range. And I’ll stand by that.”
Merten notes that the declining supply of BTC as well as its habit to form bullish higher low setups are the reasons why its not likely for Bitcoin to fall down to $30,000 mark.
“Bitcoin has been continuously setting at higher lows over time. I know a lot of people think that prices are just going to roll over and that we’re going to come back down to this range here at around $30,000. But I just don’t think it’s the case here considering the supply contraction…”
Merten also notes that the number of Bitcoin holders who have held the asset for more than a year has been growing, which plays a role in the supply contraction.
“What we’re seeing here, according to the metrics – and the on-chain metrics do not lie here, they’re fully transparent, they’re based off the Bitcoin ledger – we can see here that there are more and more people on average who are holding their Bitcoin for more than a year or more.
And this is the kind of supply contraction that in the past has led to entire bull markets or mid-cycle rallies.”
The analyst projects that weeks or months from now, the leading digital asset could start outpacing stock market indices, including S&P 500 (SPX) and the Nasdaq.
Merten’s bullishness is based on BTC against the SPX chart (BTCUSD/SPX), which the analyst notes trading within a large bull pennant and is now looks to be getting ready to take out its diagonal resistance after holding support for most of this year so far.
“I do believe here going into some time later on in May, and possibly June in the sense of you know really kind of stretching it, here getting back up into this range, getting above this ratio, breaking past this previous resistance, making it support and setting the foundation going into the summer for Bitcoin to really chart higher in price and start to significantly outpace the S&P 500, the Nasdaq and the broader equities.”
