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Bitcoin Could See A 50% Rise Based On This, Analyst Explains
An analyst has explained that a pattern in Grayscale Bitcoin Trust (GBTC) could suggest a potential 50% rise for BTC may be ahead.
Bitcoin & GBTC Have Seen A Decoupling In Recent Months
In a new post on X, analyst James V. Straten has discussed the correlation between GBTC and BTC that has been present over the years. The Grayscale Bitcoin Trust is an investment vehicle that holds Bitcoin and allows exposure to these holdings through its shares.
The chart below shows the trend in the percentage performance of Bitcoin and GBTC, as well as the correlation coefficient between them, over the past year.
The “correlation coefficient” here refers to a metric that tells us how tied the prices of any two assets are. When this metric has a positive value, the given commodities show positive correlations as they replicate each other’s moves. The closer the metric is to 1, the stronger this relationship is.
On the other hand, negative values imply the assets are responding to each other’s moves by moving in the opposite direction. The strongest negative correlation occurs at a value of -1.
Naturally, when the correlation coefficient is around zero, there isn’t any correlation between the commodities, as their prices move independently.
From the above graph, it’s apparent that Bitcoin and GBTC have often had a correlation coefficient close to 1, implying that there has been a robust positive correlation between the two.
There have been some temporary periods of deviation, mainly during drawdowns in the cryptocurrency’s price and other significant events like the SVB collapse. The correlation reverted to the norm soon after these, however.
Straten says this correlation is especially striking in a 5-year timeframe, where it becomes 100%. The analyst also notes, however, that the two assets have decoupled since June.
As is visible in the chart, GBTC has enjoyed some sharp uptrend recently, while BTC has been mostly flat. GBTC’s performance currently stands at +81% during the past year, while Bitcoin is up about 43%.
“GBTC will be the first to be approved for the spot ETF before Blackrock and others,” says Straten, referring to what British HODL, another analyst, said earlier. “Price action agrees with this. Irrespective of whether it’s late Q3 or early Q4, it’s a six-month window from now.”
Based on this, the analyst believes that either Bitcoin will have to close up the gap created between it and GBTC since June, which would mean a price jump of around 50%, or GBTC would have to come down towards BTC. Straten believes the latter scenario to be unlikely, however.
BTC Price
Bitcoin has declined over the past few days as its price has dropped to just $27,100.
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XRP Price Prediction: Crypto CEO Delivers Bad News For The Altcoin
Amidst the debate on the XRP price future trajectory, the CEO of Evai Crypto Ratings, Matthew Dixon, has provided insights into the token’s direction using the Elliot Wave Theory. However, his analysis doesn’t provide any relief to XRP holders as he projects a further decline for the token and its ecosystem.
How XRP Price Is Looking On The Charts
In a tweet shared on his X (formerly Twitter) platform, Dixon shared a price chart of XRP dating back to July, when Judge Analisa Torres ruled in favor of Ripple against the US Securities and Exchange Commission (SEC). As part of his analysis, he noted that XRP aligned with the BTC outlook.
Looking at the chart, he highlighted the bearish divergence, which indicated that the 5th wave was expected to cause a decline in the XRP price. However, before then, he projected that there is a likelihood of the token experiencing an upward trend to complete wave 4.
While Dixon’s analysis suggests a bearish outlook, he quickly noted that nothing was certain in technical analysis, although there is a high probability of this happening.
The Elliot Wave Theory, which he used to come to this conclusion, is a popular technical analysis indicator used to predict future price trends. The theory propounds that markets like XRP follow predictable sequences of optimism and pessimism driven by investor sentiment and psychology. Simply put, it agrees with the trend that there will always be a correction or retracement after a particular trend (upward or downward).
Time To Lower Expectations
Many crypto analysts have made far-fetched predictions of the XRP price, with one, in particular, stating that the token could rise as high as $10,000. However, a crypto influencer (Crypto Assets Guy) advised those in the XRP community to lower their expectations as the token won’t hit “$10,000, $1,000, $50” or even $10 any time soon.
He took a more conservative stance by stating that the token could hit a new all-time high late this year or in 2024, suggesting it could add around $3.70 to its current all-time high of $3.84. He believes the XRP community should be more than satisfied if that happens.
Meanwhile, many in the XRP community seem tired of these price predictions. This was evident when some expressed frustration after XRP influencer Jack The Rippler posted the headline of an article (dated July 31, 2023), which stated that a Wells Fargo staff had predicted the XRP price to hit $100 to $500 in the next 2 to 7 months.
One particular X user stated, “Bla bla bla evey [every] goddamn day the same shit.”
Bla bla bla evey goddamn day the same shit
— rovadi 𓄿 (@RoVaDi2001) October 10, 2023
Asian markets surge as European stocks show mixed performance
Asian stocks surged across the board on Wednesday led by South Korean market while European markets had a mixed day.
Ethereum Could See A Steep Decline If It Closes Below This Level
On-chain data suggests an Ethereum close under the $1,530 level could lead to a significant drawdown for the cryptocurrency.
Ethereum Support Levels Below $1,530 Are Very Thin Currently
In a new post on X, analyst Ali has discussed what the support and resistance levels of Ethereum are looking like right now. These support and resistance levels aren’t the technical ones, however, but rather ones based on on-chain analysis.
The support and resistance levels here are defined based on the density of investors’ cost bases. The “cost basis” here refers to the average price at which an investor acquires their coins on the blockchain.
Whenever the spot price interacts with a holder’s cost basis, they may be more prone to make a move. How the investor may react depends on the surrounding price trend.
If the Bitcoin price was earlier under the cost basis of the holder (meaning that they were in a state of loss), the asset recovering back to it could tempt the investor into selling, as they may fear that their coins would go into losses again, so exiting at break-even would seem like the better option.
On the other hand, if the price retests the cost basis from above, the investor may decide to accumulate more, thinking that if they were able to go into profits with an earlier buy at the same level, they might be able to do so once more.
Naturally, not all investors think like this, but if there are price ranges where a large amount of coins were purchased, behaviors like this might become visible on non-negligible scales.
The below chart shows how the various Ethereum price ranges look like right now based on the density of cost bases that they host:
In the above graph, the larger the circle for a price range, the more Ethereum addresses’ cost bases lie inside it. As mentioned before, levels that are particularly dense are more likely to show reactions to retests from the spot price. This means that large circles above the price can act as resistance, while those below can provide support.
From the chart, it’s visible that the current Ethereum price range has only modest on-chain support, while the higher levels are pretty dense with cost bases, so a move up would face a potentially large amount of resistance.
What’s worse, however, is the fact that the levels below the current range are quite thin, implying that there isn’t much support down there.
“Keep a close watch, as a daily close below $1,530 could signal a steep correction ahead for ETH,” warns the analyst.
ETH Price
Ethereum is currently trading around the $1,575 mark, meaning that it isn’t that far from the $1,530 level where support would end.
Crypto Bank Xapo Snags European Broker License, Will Offer Stocks Like Apple
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LIVE: Caroline Ellison Starts Day 2 of Testimony Against Sam Bankman-Fried
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