Alex Thorn Predicts Bitcoin’s Price Trajectory and Potential Breakout
As Bitcoin hovers near its all-time high, industry experts and investors are keenly watching for signs of its next major move. Alex Thorn, the Head of Research at Galaxy, recently shared his perspective on the Bitcoin price trajectory and the factors influencing its potential breakout.
In a detailed post on X (formerly Twitter), Thorn provided insights grounded in historical data and current market dynamics.
A Roller Coaster Ride
Bitcoin’s recent price action saw it reaching $69,324 on Coinbase on Tuesday, marking its first all-time high since November 10, 2021. This milestone came after an 846-day period of anticipation and speculation, only for the price to retract 14.3% to an intraday low of $59,224. This volatility, exacerbated by $400 million in long liquidations within an hour, underscores the cryptocurrency’s unpredictable nature.
Despite the pullback, Bitcoin recovered, trading back at $67,000. Thorn remarked, “Volatility is back, and it’s likely to remain as we scale the wall of worry.” He compared the current situation to 2020 when Bitcoin first approached its then all-time high of approximately $20,000 from December 2017.
The Wall of Worry
BTC faced initial resistance, experiencing a 12.33% drop after tapping the barrier twice before ultimately surging ahead. This pattern highlights the psychological and technical challenges at previous all-time highs, a natural resistance point for any asset class. A similar (second) move could be necessary this time to shake all sellers out of the market.
Describing the “Wall of Worry,” Thorn explained:
- From Jan. 1, 2017, to the Dec. 17, 2017, all-time high of ~$20k, Bitcoin experienced 13 drawdowns of 12%+ (12 were 15%+, and 8 were 25%+).
- The same story played out in 2020. Between the Mar. 12, 2020 Covid low ($3858) and the Apr. 14. 2021 ATH of $64,899, there were 13 drawdowns of 10% or more (7 of them were 15% or more).
Notably, Bitcoin already had two 15%+ retracements since the spot ETFs launched on January 11. This week was the second one, the first major drawdown was directly after the ETF launch, with the price plunging roughly 20%.
Why Bitcoin Is Just Getting Started
In his analysis, Thorn also touched upon the role of ‘old coins’ or long-held Bitcoin in shaping market movements. “Some old coins did revive and probably sell, possibly helping to create the intraday top,” he explained, pointing to blockchain data that indicated movement of coins mined as far back as 2010. This shift from old to new hands is characteristic of bull markets in Bitcoin, facilitating its broader distribution and acceptance.
Highlighting the significance of market sentiment and investment flows, Thorn noted:
- “Tuesday was the Bitcoin ETFs largest ever day of inflows and second-largest day of net inflows (+$648m) since DAY 1.”
This impressive influx of capital into Bitcoin ETFs underscores the growing interest and confidence in the cryptocurrency, even amidst volatility.
Thorn remains bullish on Bitcoin’s future, suggesting that the current price dynamics are typical of the cryptocurrency’s bull markets, known for their non-linear progression and numerous corrections. He underscored the resilience and potential for growth despite the hurdles, stating, “nothing about yesterday’s price action makes me think we aren’t going higher.”
Conclusion
In conclusion, Thorn’s analysis provides a nuanced view of Bitcoin’s journey towards breaking its all-time high. By comparing current events with past market behaviors, Thorn offers a compelling case for Bitcoin’s continued ascent but after a potential phase of consolidation with several taps of the all-time high before a definitive breakout. “Buckle up, folks. We are still just getting started,” he advises.
At press time, BTC stood at $66,821.
Hot Take: Alex Thorn Predicts Further Volatility and Growth for Bitcoin
As Bitcoin continues to flirt with its all-time high, industry expert Alex Thorn believes that more volatility is on the horizon. Despite recent price retractions, Thorn remains bullish on Bitcoin’s future and expects it to climb higher in the coming months. Here are his key takeaways:
- Bitcoin experienced an 846-day period of anticipation and speculation before reaching its recent all-time high.
- The cryptocurrency’s volatility was evident as it retracted 14.3% from its peak within hours.
- Thorn draws parallels between the current situation and 2020 when Bitcoin approached its previous all-time high.
- He notes that previous all-time highs have acted as natural resistance points for Bitcoin.
- The movement of old coins into new hands is characteristic of bull markets and facilitates broader distribution and acceptance.
- The recent influx of capital into Bitcoin ETFs highlights growing interest and confidence in the cryptocurrency.
- Thorn believes that Bitcoin’s current price dynamics are typical of bull markets, which often involve non-linear progression and corrections.
- Despite the hurdles, Thorn remains optimistic about Bitcoin’s future and expects it to continue its ascent.
In summary, Thorn’s analysis suggests that while Bitcoin may face further volatility and consolidation near its all-time high, it is poised for further growth in the long run. Investors should brace themselves for a bumpy ride but stay confident in Bitcoin’s potential.
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