{"id":175394,"date":"2021-08-06T23:00:42","date_gmt":"2021-08-06T17:30:42","guid":{"rendered":"https:\/\/ambcrypto.com\/?p=175394"},"modified":"2021-08-06T18:24:56","modified_gmt":"2021-08-06T12:54:56","slug":"what-bitcoins-s2f-deviation-means-for-its-100k-projections","status":"publish","type":"post","link":"https:\/\/ambcrypto.com\/what-bitcoins-s2f-deviation-means-for-its-100k-projections\/","title":{"rendered":"What Bitcoin&#8217;s S2F deviation means for its $100k projections"},"content":{"rendered":"<p><span style=\"font-weight: 400;\"><a href=\"http:\/\/ambcrypto.com\/category\/bitcoin-news\/\">Bitcoin<\/a>, at the time of writing, was seemingly on its way to recovery. As is always the case, a period of sustained movement always births the question &#8211; Can BTC touch $100,000? This is a crucial question, especially since according to some, the cryptocurrency should already be at or close to $100k.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">A look at Bitcoin\u2019s 4-year cycle might help us figure out by when BTC would hit $100,000.<\/span><\/p>\n<h3>A major deviation<\/h3>\n<p><span style=\"font-weight: 400;\">That should\u2019ve been the case presently had Bitcoin followed the path laid down by PlanB\u2019s Stock-to-Flow (S2F) ratio model. This model is based on the logic of \u2018scarcity driving value.\u2019 <\/span><\/p>\n<p><span style=\"font-weight: 400;\">If you look at the S2F deflection chart, you can see that despite the rally which pushed BTC to trade at $40,515, the metric placed BTC at its cheapest over the course of 10 years. While the price of the king coin has consistently risen over time, the indicator seems to be undervaluing the cryptocurrency.<\/span><\/p>\n<figure id=\"attachment_175402\" aria-describedby=\"caption-attachment-175402\" style=\"width: 1800px\" class=\"wp-caption aligncenter\"><a href=\"http:\/\/ambcrypto.com\/wp-content\/uploads\/2021\/08\/glassnode-studio_bitcoin-stock-to-flow-deflection.png\"><img decoding=\"async\" class=\"wp-image-175402 size-full\" src=\"http:\/\/ambcrypto.com\/wp-content\/uploads\/2021\/08\/glassnode-studio_bitcoin-stock-to-flow-deflection.png\" alt=\"\" width=\"1800\" height=\"1013\" srcset=\"https:\/\/ambcrypto.com\/wp-content\/uploads\/2021\/08\/glassnode-studio_bitcoin-stock-to-flow-deflection.png 1800w, https:\/\/ambcrypto.com\/wp-content\/uploads\/2021\/08\/glassnode-studio_bitcoin-stock-to-flow-deflection-300x169.png 300w, https:\/\/ambcrypto.com\/wp-content\/uploads\/2021\/08\/glassnode-studio_bitcoin-stock-to-flow-deflection-1024x576.png 1024w, https:\/\/ambcrypto.com\/wp-content\/uploads\/2021\/08\/glassnode-studio_bitcoin-stock-to-flow-deflection-768x432.png 768w, https:\/\/ambcrypto.com\/wp-content\/uploads\/2021\/08\/glassnode-studio_bitcoin-stock-to-flow-deflection-1536x864.png 1536w\" sizes=\"(max-width: 1800px) 100vw, 1800px\" \/><\/a><figcaption id=\"caption-attachment-175402\" class=\"wp-caption-text\"><em>Bitcoin S2F Deflection model<\/em> | Source: <a href=\"https:\/\/studio.glassnode.com\/\">Glassnode &#8211; AMBCrypto<\/a><\/figcaption><\/figure>\n<p><span style=\"font-weight: 400;\">However, focusing on the &#8220;when&#8221; part, BTC still has some time before it hits the aforementioned level. The S2F ratio seems to suggest that the current deviation from Bitcoin\u2019s predicted price point is similar to the Nov 2018 deviation. <\/span><\/p>\n<p><span style=\"font-weight: 400;\">Back then, the price was close to $5k-$6k and the predicted price was close to $9k. It took 6 months for the price action to correct itself and BTC was back on the path by June 2019<\/span><\/p>\n<figure id=\"attachment_175403\" aria-describedby=\"caption-attachment-175403\" style=\"width: 1800px\" class=\"wp-caption aligncenter\"><a href=\"http:\/\/ambcrypto.com\/wp-content\/uploads\/2021\/08\/glassnode-studio_bitcoin-stock-to-flow-ratio.png\"><img decoding=\"async\" class=\"wp-image-175403 size-full\" src=\"http:\/\/ambcrypto.com\/wp-content\/uploads\/2021\/08\/glassnode-studio_bitcoin-stock-to-flow-ratio.png\" alt=\"\" width=\"1800\" height=\"1013\" srcset=\"https:\/\/ambcrypto.com\/wp-content\/uploads\/2021\/08\/glassnode-studio_bitcoin-stock-to-flow-ratio.png 1800w, https:\/\/ambcrypto.com\/wp-content\/uploads\/2021\/08\/glassnode-studio_bitcoin-stock-to-flow-ratio-300x169.png 300w, https:\/\/ambcrypto.com\/wp-content\/uploads\/2021\/08\/glassnode-studio_bitcoin-stock-to-flow-ratio-1024x576.png 1024w, https:\/\/ambcrypto.com\/wp-content\/uploads\/2021\/08\/glassnode-studio_bitcoin-stock-to-flow-ratio-768x432.png 768w, https:\/\/ambcrypto.com\/wp-content\/uploads\/2021\/08\/glassnode-studio_bitcoin-stock-to-flow-ratio-1536x864.png 1536w\" sizes=\"(max-width: 1800px) 100vw, 1800px\" \/><\/a><figcaption id=\"caption-attachment-175403\" class=\"wp-caption-text\"><em>Bitcoin S2F Ratio model<\/em> | Source: <a href=\"https:\/\/studio.glassnode.com\/\">Glassnode &#8211; AMBCrypto<\/a><\/figcaption><\/figure>\n<p><span style=\"font-weight: 400;\">So, if that historical movement is taken into account, one should expect a few more months before Bitcoin hits $100k. Since a rally might just be in motion going forward, BTC might soon achieve that price point. <\/span><\/p>\n<p><span style=\"font-weight: 400;\">Additionally, Bitcoin\u2019s 4-year cycle retracement finally happened as the $29k resistance turned into support. It now seems to be following the traditional pattern of a market structure. Thus, the only way ahead is up, albeit not immediately.<\/span><\/p>\n<figure id=\"attachment_175405\" aria-describedby=\"caption-attachment-175405\" style=\"width: 2560px\" class=\"wp-caption aligncenter\"><a href=\"http:\/\/ambcrypto.com\/wp-content\/uploads\/2021\/08\/E7yz4sdXoAEWCzg-scaled.jpg\"><img decoding=\"async\" class=\"wp-image-175405 size-full\" src=\"http:\/\/ambcrypto.com\/wp-content\/uploads\/2021\/08\/E7yz4sdXoAEWCzg-scaled.jpg\" alt=\"\" width=\"2560\" height=\"1737\" srcset=\"https:\/\/ambcrypto.com\/wp-content\/uploads\/2021\/08\/E7yz4sdXoAEWCzg-scaled.jpg 2560w, https:\/\/ambcrypto.com\/wp-content\/uploads\/2021\/08\/E7yz4sdXoAEWCzg-300x204.jpg 300w, https:\/\/ambcrypto.com\/wp-content\/uploads\/2021\/08\/E7yz4sdXoAEWCzg-1024x695.jpg 1024w, https:\/\/ambcrypto.com\/wp-content\/uploads\/2021\/08\/E7yz4sdXoAEWCzg-768x521.jpg 768w, https:\/\/ambcrypto.com\/wp-content\/uploads\/2021\/08\/E7yz4sdXoAEWCzg-1536x1042.jpg 1536w, https:\/\/ambcrypto.com\/wp-content\/uploads\/2021\/08\/E7yz4sdXoAEWCzg-2048x1390.jpg 2048w\" sizes=\"(max-width: 2560px) 100vw, 2560px\" \/><\/a><figcaption id=\"caption-attachment-175405\" class=\"wp-caption-text\"><em>Bitcoin&#8217;s 4-year cycle<\/em> | Source: <a href=\"https:\/\/twitter.com\/rektcapital\/status\/1422209433397088256\">Rekt Capital<\/a><\/figcaption><\/figure>\n<h4><strong>How to identify the $100k trend?<\/strong><\/h4>\n<p><span style=\"font-weight: 400;\">A couple of metrics need to be observed here as they will be the first indicators of where the price is heading. First of all, the <a href=\"http:\/\/ambcrypto.com\/wp-content\/uploads\/2021\/08\/glassnode-studio_bitcoin-adjusted-sopr-asopr.png\">adjusted SOPR<\/a> (aSOPR) needs to maintain its movement above 1. This is necessary for a steady uptrend. Should it fall below, losses can enter the market. <\/span><\/p>\n<p><span style=\"font-weight: 400;\">Moreover, the GBTC premium is now improving as well, something that suggests institutional interest is growing too. In fact, it has risen by 9% since May, climbing to -8% at press time. Finally, <a href=\"http:\/\/ambcrypto.com\/wp-content\/uploads\/2021\/08\/Bitcoin-BTC-15.38.03-06-Aug-2021.png\">social volumes<\/a> and <a href=\"http:\/\/ambcrypto.com\/wp-content\/uploads\/2021\/08\/Bitcoin-BTC-15.38.03-06-Aug-2021.png\">investor sentiment<\/a> must remain positive to protect Bitcoin from any major bear move.\u00a0<\/span><\/p>\n<figure id=\"attachment_175400\" aria-describedby=\"caption-attachment-175400\" style=\"width: 1800px\" class=\"wp-caption aligncenter\"><a href=\"http:\/\/ambcrypto.com\/wp-content\/uploads\/2021\/08\/gbct-premium.png\"><img decoding=\"async\" class=\"wp-image-175400 size-full\" src=\"http:\/\/ambcrypto.com\/wp-content\/uploads\/2021\/08\/gbct-premium.png\" alt=\"\" width=\"1800\" height=\"1013\" srcset=\"https:\/\/ambcrypto.com\/wp-content\/uploads\/2021\/08\/gbct-premium.png 1800w, https:\/\/ambcrypto.com\/wp-content\/uploads\/2021\/08\/gbct-premium-300x169.png 300w, https:\/\/ambcrypto.com\/wp-content\/uploads\/2021\/08\/gbct-premium-1024x576.png 1024w, https:\/\/ambcrypto.com\/wp-content\/uploads\/2021\/08\/gbct-premium-768x432.png 768w, https:\/\/ambcrypto.com\/wp-content\/uploads\/2021\/08\/gbct-premium-1536x864.png 1536w\" sizes=\"(max-width: 1800px) 100vw, 1800px\" \/><\/a><figcaption id=\"caption-attachment-175400\" class=\"wp-caption-text\"><em>Bitcoin GBTC Premium<\/em> | Source: <a href=\"https:\/\/studio.glassnode.com\/\">Glassnode &#8211; AMBCrypto<\/a><\/figcaption><\/figure>\n<p><span style=\"font-weight: 400;\">However, do not hook all your hopes just to the S2F model as it is not a godsend metric and its predictions aren\u2019t absolute. In fact, <a href=\"https:\/\/wublock.substack.com\/p\/talk-with-cryptoquant-ceo-ki-young\">talking<\/a> about its accuracy, this is what CryptoQuant CEO Ki Young Ju had to say,<\/span><\/p>\n<blockquote><p><span style=\"font-weight: 400;\">&#8220;I think S2F model is flawed in terms of the demand side. This model is based on scarcity and scarcity is about the supply side. That&#8217;s why the current BTC price deviates greatly from the price predicted by the S2F model. If PlanB adds some variables to see demand-side factors, the model can be more accurate I think.&#8221;<\/span><\/p><\/blockquote>\n","protected":false},"excerpt":{"rendered":"<p>Bitcoin, at the time of writing, was seemingly on its way to recovery. As is always the case, a period of sustained movement always births the question &#8211; Can BTC touch $100,000? This is a crucial question, especially since according to some, the cryptocurrency should already be at or close to $100k.\u00a0 A look at<a href=\"https:\/\/ambcrypto.com\/what-bitcoins-s2f-deviation-means-for-its-100k-projections\/\">Continue reading <span class=\"sr-only\">&#8220;What Bitcoin&#8217;s S2F deviation means for its $100k projections&#8221;<\/span><\/a><\/p>\n","protected":false},"author":43,"featured_media":175399,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"om_disable_all_campaigns":false,"footnotes":""},"categories":[35,360,66,3,4,20],"tags":[],"class_list":["post-175394","post","type-post","status-publish","format-standard","has-post-thumbnail","category-bitcoin-news","category-btc-trading-view","category-new-news","category-news","category-social","category-trading-view"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v28.0 (Yoast SEO v28.4) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>What Bitcoin&#039;s S2F deviation means for its $100k projections - AMBCrypto<\/title>\n<meta name=\"description\" content=\"As is always the case, a period of sustained movement always births the question - Can BTC touch $100,000? 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