Bitcoin ( BTC ) spending more than three weeks in the $30,000 range is proving to be a key test for one of its best-known price models.
As Philip Swift, co-founder of the Decentrader trading suite, noted on June 11, bitcoin poses a serious challenge to the flow stock price forecasting tool.
The BTC price action has oscillated in the lower range between $30,000 and $40,000 since mid-May. This has worried day traders, while vintage bulls have called for calm and a long-term mindset.
The stock-to-flow model continues to account for this behavior, even as its estimates call for a BTC/USD value close to $70,000.
However, its creator, PlanB, has expressed concern about the future. If current levels continue for an extended period of time, his model could be invalidated for the first time in its history.
Highlighting the divergence of spot prices from the average stock price to flow, Swift explained that such instances have actually happened before. Each time, bitcoin has rebounded from a particular price point relative to the average stock-to-flow to eventually reach new all-time highs.
