There has been a clear upward trend in the price of Bitcoin in recent weeks. From a low of around $15,500 in November, it went up to around $24,000. This corresponds to a strong growth of almost 55 percent within less than 2 months. The clear recovery encourages renewed euphoria among investors that the initial currency has now survived the bear market and the rally will continue.
The well-known trader and analyst Plan B now adds more to these hopes. The analyst, known for his stock-to-flow forecasting model, published a new video on his YouTube channel in which he points out seven bullish signals on the price of Bitcoin. In his estimation, these could lead to a huge increase in the price of Bitcoin.
Sign 1: Bitcoin is spreading
Bitcoin Halving is Plan B’s first bullish signal. His analytical model is based on the theory that the demand for Bitcoin will increase with falling supply and the price will increase significantly – classic market theory. With Bitcoin, the new supply of BTC that comes into circulation is reduced every 4 years. Because of its halving, the reward to the miners for each Bitcoin block mined is reduced by 50 percent every four years.
Currently there is 12.5 BTC for a new block and a new block is added to the chain every ten minutes. However, the next half is due in 2024 and the block reward will accordingly decrease to 6.25 BTC. Plan B is certain that Bitcoin demand and prices will rise again as a result of the event. History has proved him right so far. Every past semi event in BTC’s 14-year history has seen the course reach a new all-time high.
In his video, Plan B shows that the actual price of BTC is currently well below the projected stock-to-flow price and is thus cheaper than its true value. In addition, the periods before the half are assigned to different color categories in Plan B. We are currently in the green phase, which corresponds to a period of 20-15 months before the spread. Soon, however, according to Plan B, Bitcoin will enter the blue phase when the halving is less than 15 months away. These blue phases have historically been characterized by price increases. Therefore, the analyst sees a bullish sign for Bitcoin coming here.
Indicator 2: Relative Strength Index
Plan B sees the second bullish signal for Bitcoin in the Relative Strength Index (RSI). This technical indicator describes when an asset is overbought, oversold, or in neutral territory for Bitcoin buyers. In his chart, Plan B analyzes that the RSI for Bitcoin is currently still in a very low area, but is slowly rising. For him, this is a sign that the bear market is over and that a good buying opportunity for Bitcoin has now arrived.
Plan B adds that the RSI for Bitcoin is different from the classic stocks because the crypto market is much more volatile. Therefore, Bitcoin could stay longer and higher in an actual overbought zone according to the RSI.
Sign 3: Bitcoin buyers in profit
The third signal describes how much of the Bitcoin buyers are in profit compared to the current price. This OnChain indicator is not based on the Bitcoin on exchanges, but on the BTC secured on private wallets.
Plan B shows that at the end of a bear market, only about 50 percent of Bitcoin holders are in profit, sometimes even less. This was also sometimes the case in the bear market of 2022. Plan B gave this phase a blue color. However, with the increase in Bitcoin price, about 70 percent of BTC holders are already in profit again and the color has changed to green. According to the analyst, this has historically been a typical signal for the end of the bear market and is therefore bullish.
However, Plan B also suggests that 2015 was a fake out and the number of BTC in profit fell back into the 50 percent range. According to his analysis, this fake also existed in 2022 after the FTX crash.
Signal 4: Bitcoin price realized
The fourth chart signal is the realized bitcoin price. This is the value of all bitcoins at the price they were purchased divided by the number of bitcoins in circulation.
According to his analysis, the bottom of the bear market is usually marked by the real bitcoin price falling to or even below this realized price. This event also occurred in 2022. Currently, however, the Bitcoin price is again much higher than the realized price, which Plan B considers bullish.
However, the price of Bitcoin is still below the realized price of BTC for the past 2 years. However, in a bull market, Plan B says that bitcoin is above all realized prices. According to his theory, this speaks for a further rise in the price in the near future.
Sign 5: Realized profit
The next signal shows the amount of actual profits that buyers received from BTC in a certain period. To do this, investors have to sell their BTC at a higher price than they bought it for.
This also shows that many Bitcoin buyers have sold their BTC at a loss in recent months. According to Plan B, this is the typical sign of the end of the bear market. At the moment, however, the realized profit is slightly in the green again, which the analyst rates as bullish.
Signal 6: BTC transactions
The next signal, the RHS On Chain indicator, describes the trading volume and the number of transactions with Bitcoin in circulation. This would rise significantly again at the moment, which should be considered bullish. According to Plan B, the indicator can also be used to read the end of a bull market when the RHS reaches its highest point.
Sign 7: Bitcoin and S&P 500
The last bullish signal that Plan B addresses in its video is the correlation of the course of Bitcoin with the American stock index S&P 500. In this chart, which puts Bitcoin over the scaled chart of the S&P 500, the course of Bitcoin according to Plan B is significantly below. its typical value. In order to achieve correlation again, Bitcoin would have to rise significantly, which speaks for an upward trend, according to the analyst.
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