Plan B Reconfirms His Forecast: Bull Cycle Not Over, $64K Was Not the Top
A widely-followed bitcoin analyst and creator of the stock-to-flow price model, Plan B, said last that he believed the “bull is not over.” Plan B is still confident about his forecast and reconfirmed his message from last month. At the same time, Bitcoin prices have been able to bounce back and on Sunday, touching a high of $45,355.
Plan B Confident in Previous Forecast, Bitcoin Price Visits $45K
Bitcoin (BTC) has been showing strength lately, and ironically in the face of regulatory uncertainty in the United States, and globally. BTC gained over 11% during the last seven days and 30-day stats show the leading crypto asset is up 31% against USD.
Since the opening trading sessions on August 5, at $39,734 per BTC, the crypto asset has gained 12.97% in three days. Moreover, following the bullish action, the famous trader and analyst, known in the industry as PlanB, seems more confident the bitcoin bull run is not over.
Plan B started documenting his popular stock-to-flow (S2F) price model on Bitcoin back in March 2019. The pseudonymous analyst has also updated the S2F price model to the stock-to-flow cross-asset (S2FX) model.
On June 1, Plan B thought the S2FX model was still intact and claimed it was starting to look like 2013. A number of analysts have been comparing this run to the 2013 bull run because during that time BTC saw a double top.
BTC/USD chart via Bitstamp on Sunday, August 8, 2021.
On August 1, the analyst explained that BTC’s realized capitalization was on the rise and in his opinion, things were looking bullish.
“Bitcoin’s realized cap is rising again! Realized cap is the average price at which all 18.77M BTC were last transacted (calculated over all UTXO’s). Also, the few sellers at the moment sell at a profit (not a loss like in May and June). IMO this is bullish.”
#bitcoin realized cap is rising again! Realized cap is the average price at which all 18.77M BTC were last transacted (calculated over all utxo's). Also, the few sellers at the moment sell at a profit (not a loss like in May and June). IMO this is bullish. pic.twitter.com/q3mhSZ19oH
At time of writing the number of bitcoin (BTC) in circulation today is 18,780,525 BTC and the reward halving is expected in just over 1,008 days from now. At that time, BTC’s issuance will become far more scarce, as the block reward of 6.25 coins per block will be reduced to 3.125 coins per block post halving.
Plan B’s S2F or S2FX is all about scarcity and essentially the crypto asset’s low issuance rate and scarcity should bolster the value of BTC over the long term. Basically the stock-to-flow measures the abundance or lack of when it comes to BTC’s long-term issuance rate. The current amount of BTC (stock) is simply divided by the number of bitcoins produced (flow) on an annual basis.
In Plan B’s original thesis he also published a chart of other products like precious metals (gold & silver) to describe how the S2F model works with different commodities. Gold historically has shown the highest S2F ratio at least in terms of commodities like precious metals.
Bitcoin, on the other hand, has a much higher S2F ratio which means over the long term, the crypto asset retains value or rises from significant demand. In 2019, when Plan B published his original model he added that “gold and silver, which are totally different markets, are in line with the bitcoin model values for SF.” The analyst also emphasized there’s an “indication of a power law relationship.” The pseudonymous analyst added:
“The model predicts a bitcoin market value of $1trn after next halving in May 2020, which translates in a bitcoin price of $55,000.”
Plan B: ‘August Will Close Above $47K’
After May 2020, the price of BTC did rise over the $55K per unit zone and the market valuation also spiked over a trillion dollars in overall value. Since then the price of BTC has dropped significantly on two occasions but Plan B remains confident.
On August 6, Plan B re-tweeted an older tweet he published on July 2 and said: “Just to reconfirm this message from last month.” At that time, Plan B said that he believes the bull run is not over and today it seems he’s fairly certain his old statement from the first week of July still rings true. Plan B said:
“My onchain data (color overlay in the chart below) tells me this bull is not over and 64K was not the top. That is in line with [the] S2F(x) model. Also my floor indicator (not based on S2F) says we will not go below $47K Aug close.”
The analyst clarified that the floor estimator was not based on S2F when a person asked the analyst a question. “So Aug will see the price go above 47k? Is that what you mean?” the Twitter account dubbed “Crypto Storm” asked. “August will close above 47k. Ps, this floor estimator is not based on S2F,” Plan B replied.
August will close above 47k. Ps this floor estimator is not based on s2f.
