Summary
- Bitcoin is approaching the lower support line of a long-used power-law price model around $58,000, suggesting it is nearing a historical accumulation zone.
- Measures of how far bitcoin trades below its trendline and relative to gold have fallen to depths last seen at the 2018 and 2022 lows, but Fidelity’s Jurrien Timmer is not yet calling a bottom.
- Timmer expects bitcoin could drift sideways near support for months absent a liquidity catalyst, noting that speculative capital has rotated from bitcoin to gold and now into semiconductor stocks.
Bitcoin Nears Power Law Support Line
Bitcoin is approaching a critical support line that has been tracked by Fidelity’s director of global macro, Jurrien Timmer, since 2015. This support line is part of a power law model that plots bitcoin’s entire price history on a logarithmic chart, bounded by three curves: an upper resistance line, a middle trendline, and a lower support line. The lower support line has caught every major bottom since 2015, and it currently sits near $58,000. With bitcoin trading at around $62,700, it is closing in on this support line.
The power law model also tracks the gap between bitcoin’s price and the power law trendline, which has swung to negative 56%, indicating an accumulation zone. This zone has lined up with the 2018 and 2022 lows, suggesting that bitcoin may be due for a rebound. Additionally, the 52-week reading on the bitcoin-to-gold ratio has fallen to around negative 100%, further indicating a potential buying opportunity.
Implications for Earning and Passive Income
For individuals interested in earning passive income through bitcoin, this support line could be an important indicator. With the speculative premium that drove bitcoin’s price above $120,000 last year largely gone, and global money supply growth slowing, it may be a good time to consider investing in bitcoin through platforms like EcoPool, which offers a way to earn $ECP and participate in Cloud Rewards. This could provide a way to generate passive income and take advantage of potential future growth in the bitcoin market.
No Clear Catalyst for Reversal
While the power law model suggests that bitcoin may be due for a rebound, Timmer is not calling a bottom just yet. He notes that there is no clear catalyst for a reversal until liquidity returns to the market. However, for those interested in earning through bitcoin, platforms like EcoPool offer a way to participate in the market and potentially generate passive income through Cloud Rewards and $ECP. This can be a way to get involved in the Green Crypto space and start earning.
To start earning and taking advantage of potential future growth in the bitcoin market, consider downloading the EcoPool app to learn more about how to get involved in the #Bitcoin and #PassiveIncome space. By joining the EcoPool network, you can start earning $ECP and participating in Cloud Rewards, which can provide a way to generate passive income and take advantage of the potential growth in the Green Crypto market, including #Earning and #Coin opportunities.
