As soon as the Federal Reserve chair, Jeremy Powell, shared the tapering news, financial markets went into depression. The FR chairperson has announced that the bond purchases are going to be reduced from $120 billion to $15 billion on a monthly basis. The news created massive panic in the financial markets and increased the volatility of Bitcoin.
However, Bitcoin enthusiast PlanB has recently shared three reasons that he is still bullish on the flagship cryptocurrency. The Dutch analyst claimed that the RSI index is currently resting at 68. It is worth noting that the Relative Strength Index is used to measure the changes in buying and selling positions for an asset. According to PlanB, Bitcoin is yet to enter the overbought zone.
For reference, PlanB shared the histogram of bullish development for Bitcoin during the 2017 bull market run. He pointed out that in the previous bullish run, Bitcoin plunged four times. He further explained that each of these four dips ranged from 29% to 38% correction. However, despite the dips, Bitcoin was able to register another ATH in 2017.
PlanB pointed out that Bitcoin missed the chance of bullish development in the same month four times during the 2017 Bull Run and still managed to get to a new ATH of $20K by adding $1K per unit. Therefore, another bullish development for the flagship crypto is not out of the question.
PlanB has continued to show optimism towards the flagship cryptocurrency and claims that he is still hoping for Bitcoin to register a highly anticipated $100K price point. To fulfil this prediction, Bitcoin will need to gain 100% above resistance. He also mentioned that the S2F model is bullish for Bitcoin.
The stock-to-flow model or S2F takes note of the total circulation in comparison to the mined coins within a year. The model has been created by PlanB for the crypto market, and it has managed to predict the price of the flagship crypto with great accuracy from August to the last month. Nevertheless, investors are proceeding with caution taking notes from the market sentiment.