The stock to flow ratio has been the highest for Gold so far in 62 years. A well-known crypto analyst stated, it is not possible for regular commodities to provide for higher S/F ratio as any commodity with market attention surges in value and the production rises, and the prices go down again.
Bitcoin is reported to have a stock of 17.5 million coins. The supply is at 0.7 million per year. This is a notable equivalent to the 25 S/F ratio. Considering these parameters, there are a few crypto analysts who are of the opinion that the stock to flow ratio of Bitcoin might overtake Gold with respect to valuation.
While the overall data of the cryptocurrency market is in favor of the bull market, cryptoanalysts add to the confidence by stating that the worse is over for BTC.
Willy Woo, a technical analyst, opines, “I’m swimming in data and you kind of get intuition concerning things. I would say a one-in-20 to one-in-40 chance that this floor falls through. So that is 95%-97.5% that the bottom is in. I would consider if we drop below $4,300, they [bears] would be very lucky.”
The analyst backs his opinion by looking through the matters that are considered in looking at the adoption curve of BTC and further states: “We see a doubling in user base every year pretty consistently over 10 years.
So what we see is the mapping of the world coming in and in this case the world coming in with capital that’s injecting into Bitcoin.”
There are contradictory bearish arguments against Bitcoin as well.
Tone Vays stated, “Lot of the big institutional holders have not capitulated. The Novogratz’s and the Tim Drapers who have been holding these coins for a long time. I believe bitcoin finds ways to crush people’s souls. I believe the market will find a way to separate them from those coins somehow. And these are the big holders I’m actually waiting to capitulate.”
However, for those who are looking to place their bets considering where Bitcoin is heading next, then the data might be overwhelmingly in favor of the bull market.
The 4-hours MACD for BTC/USD is placed in the bearish zone. 4 hours RSI (Relative Strength Index) is moving towards the 50 levels. The major support level is seen at $5.160, and the Major resistance level is seen at $5.400.
If Bitcoin would replace gold completely, then BTC would be valued at $350000.