SF Ratio Reading Means Bitcoin is Under Priced at $8,700, Ready for $20,000?

 
SHARE:

Latest Bitcoin (BTC) News

In its pure form, Bitcoin is a blend of different fields. Learning the nitty gritties of Bitcoin and
blockchain, therefore, demands one to learn the ropes of information theory, of cryptography,
computer science, economics, and even psychology thanks to the psyche element that’s so
unique digital assets.

Bitcoin is a working platform, its source code is robust and behind the tech is a global
community that is securing the network, wading off attacks. It is the Internet money, the
currency of the web, and of the people that is indeed a revolution.

Although certain jurisdictions are yet to formulate laws to effectively control and even accept
the coin, it’s using is far-reaching and even consequential. The asset is a relief for the unbanked, a
store of value for those in shaky economies and literally a haven that could rival Gold in the
next decade.

In fact, according to recent Stock to Flow (SF) analysis, Bitcoin has a reading of 25, placing it at
the same valuation as Silver. However, it is next year’s major event, the halving, that could be
triggering a front run, drawing demand and the result is a spike above $8,500, which if
anything, is still a discount.

With a market cap of roughly $7 trillion, Gold has an SF of around 70 and after next year’s
halving, BTC’s reading could rise to somewhere between 40 to 50, meaning BTC is underpriced
at spot rates.

BTC/USD Price Analysis

At the moment, Bitcoin (BTC) is changing hands at $8,750 and up 8.9 percent in the last 24
hours. Because of the demand behind the asset, BTC is now trading above our minor resistance
and first target of $8,500 in a minor breakout and trend continuation.

Simply because of this, traders are free to fine-tune entries in smaller time frames now that
Bitcoin is free from the minor $1,000 consolidation with floors at $7,500. In line with our last
BTC/USD trade plans, bulls are firmly in control and after April close above $4,500, prices broke
above a 7-month resistance trend line ushering in a wave of buy pressure, effectively rewinding
losses of Q4 2018 and confirming the end of the dreaded crypto winter.

Now that sentiment is shifting and bulls are in control thanks to improving market conditions
and other fundamentals, the path of least resistance is set. As a result, traders should set their
aim at $10,000 and later $12,000. Both are crucial resistance levels and most importantly,
$10,000 is not only a liquidation level but a psychological round number.

All Charts Courtesy of Trading View—Coinbase

Disclaimer: Views and opinions expressed are those of the author and aren’t investment advice.
Trading of any form involves risk and so do your due diligence before making a trading decision.