Market Analysis

Bitcoin (BTC) has never been as far below its target price as it is now, the stock-to-flow model shows this week.

In a tweet on July 10, Lex Moskovski, chief investment officer at Moskovski Capital, showed stock-to-flow flagging a historic moment in Bitcoin’s twelve-year lifetime.

“Great buying opportunity”

With BTC/USD showing few signs of a genuine bullish recovery, the pair has been drifting ever further from the price that the stock-to-flow price model calculates it should have.

Stock-to-flow is arguably the most popular of the Bitcoin forecasters, and has historically tracked BTC price action with surprising accuracy, taking every anomaly into account to remain valid.

As Cointelegraph reported, however, current behavior is giving stock-to-flow a run for its money, and as of now, its target price comparatively has never been so far from reality.

“Negative Stock-To-Flow deflection is the highest it’s ever been in the whole Bitcoin history,” Moskovski commented.

“This is a great buying opportunity, if you’re a believer in this model.”

According to the Stock-to-Flow Multiple, BTC/USD should be trading at $82,703 on Saturday. At the time of writing, the actual spot price was $33,850 — 59% lower.

The model’s creator, PlanB, has stuck by a seriously bullish view on Bitcoin for 2021, his latest price prediction calling for $135,000 by December as a “worst-case scenario.”

The analyst is currently off the grid and not commenting on events, promising to return in August, which has a minimum price target of around $47,000.

Stock-to-flow faces serious bear calls

PlanB has never ruled out stock-to-flow becoming invalidated at any point, and this could become a reality if the most bearish scenarios become reality.

Related: PlanB feeling ‘uneasy’ as 41% of his followers tip $100K BTC won’t happen this year

Among them is a $10,000 warning from Scott Minerd, the Guggenheim executive who this week claimed there was not “any reason” to buy Bitcoin under current conditions.

Other data points to an extended recovery period for Bitcoin fundamentals, while December could bring selling pressure once more, in line with historical precedent. 

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.