Bitcoin’s Price Boom: A New Era for Crypto?
On December 16th, Bitcoin’s price jumped by over 2%, establishing a new record high of around $106,535. This significant increase marks the beginning of a new era for cryptocurrency, as its top accumulator, MicroStrategy, enters the Nasdaq 100 Index.
Bitcoin’s Price Boom: What’s Behind It?
Bitcoin has surged over 136% in 2024, with more than half of the gains coming after Donald Trump’s election victory on November 6th. Expectations of pro-crypto policies and the inclusion of crypto-focused firms in a major Wall Street index have fueled both interim and long-term bullish sentiment.
Factors Contributing to Bitcoin’s Price Boom
- Pro-Crypto Policies: The possibility of pro-crypto policies under Donald Trump has created a favorable outlook for cryptocurrency.
- Inclusion in Major Indices: MicroStrategy’s entry into the Nasdaq 100 Index has further boosted investor confidence in Bitcoin.
Veteran Analyst Peter Brandt Projects $120,000 as Next Upside Target
Veteran analyst Peter Brandt believes that Bitcoin’s current bull cycle may continue toward $120,000. In a technical setup shared on his X handle, the chartist showed Bitcoin breaking out of what appears to be a bull flag pattern.
Bull Flag Pattern: What Does it Mean?
- Bull Flags: A bull flag is a technical setup where the price consolidates inside a sideways or downward-sloping rectangle range after a strong price rally.
- Breakout: When the price breaks above the flag’s upper trendline and rises by as much as the previous uptrend’s height.
As of December 16th, BTC’s price was entering the breakout stage of the bull flag pattern. Brandt projects $120,000 as the next likely upside target.
Fibonacci Fractals Suggest $155,500 as Next Major Milestone
Based on its historical performance and Fibonacci extensions, Bitcoin could also be on track to reach $150,000–$154,000. In previous cycles, the cryptocurrency consistently broke past the 1.618 Fibonacci extension level before advancing toward higher extensions.
Fibonacci Extensions: What Do They Mean?
- Fibonacci Levels: Fibonacci levels are mathematical ratios that help traders identify potential price targets and support/resistance levels.
- Extensions: Fibonacci extensions are used to project potential price movements based on previous trends.
As of December 16th, Bitcoin surpassed the 1.618 level at approximately $102,000. The breakout suggests that the next major milestone could be the 2.618 level near $155,500.
Analysts Project $800,000 by 2025’s End
Bitcoin could hit $800,000 by the end of 2025, according to analysts’ projections based on its capped supply and favorable policy outlook.
Projections Based on Capped Supply
- Capped Supply: Bitcoin has a fixed supply, which means that there will only ever be 21 million coins in circulation.
- Favorable Policy Outlook: The possibility of pro-crypto policies under Donald Trump has created a favorable outlook for cryptocurrency.
PlanB, creator of the popular stock-to-flow model, predicts Bitcoin’s average price to reach $500,000 in 2025, with potential highs of $1 million. Perianne Boring, founder of The Digital Chamber, echoed this optimism, citing the stock-to-flow model and the possibility of pro-crypto policies under Donald Trump.
Stock-to-Flow Model: A Brief Overview
The stock-to-flow model is a mathematical framework that helps predict Bitcoin’s price based on its supply and velocity. According to PlanB, the model suggests that Bitcoin’s market cap could climb from $2 trillion to $15 trillion, driving its price toward $800,000.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
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