Bitcoin Bulletin long-term bitcoin price predictions revealed
Today, we’re taking a break from our regular weekly market roundup to look at the big picture for bitcoin price action over the coming months and years, including Bitcoin Bulletin’s long-term bitcoin price predictions.
The immediate future is, as ever, unclear for bitcoin. We have repeatedly stated that markets are inherently unpredictable in the short term: they can only work this way, and the shorter the timescale, the less predictable they are.
This article is for information only. Bitcoin Bulletin will never give you trading or investment advice.
Over the longer term the picture becomes clearer. Given where we are in Bitcoin’s lifespan we are confident that the future is bright for bitcoin, cryptocurrency in general, and broader blockchain technology. Let’s summarise some thoughts on three different timescales: the short-term (weeks), medium term (months) and long-term (years).
The short-term picture
The sudden move above $5,000 caught many traders by surprise and we are now waiting for the resolution of this development. There are a series of key areas between $4k and $5k, which will be price support if BTC trades above them and resistance if it drops below:
- $5,400-5,600, where BTC briefly paused on its slide from $6,000 to $3,100 in November.
- $4,900-5,000, where BTC has traded for an extended period since the beginning of April.
- $4,200, which BTC broke through to create a higher high. A retest of this level and move higher once again would be another piece of evidence that the bear market was over – while a break below it would prompt renewed pessimism.
The 200 weekly moving average was strong support when BTC dropped towards $3,000 in December. This line currently stands around $3,500. If BTC falls this far again, we can expect more strong buying activity and potentially a double bottom – followed by a reversal of the trend into a new bull run. However, should BTC break this line – and the low for this cycle at $3,100 – then we would most likely be looking at further deep falls into the $2,000s.
On the upside, if BTC does consolidate above $5,000, there will be extremely strong resistance at $6,000, which was tested multiple times over the course of 2018. Breaking this level and consolidating above it would surely indicate a decisive end to the bear market and significant confidence in bitcoin once again.
The long-term outlook
In a recent paper, Timothy Peterson explores the long-term growth of bitcoin, comparing it both to Facebook’s growth and to the spread of viruses and other natural phenomena. His research suggests that bitcoin’s long-term growth may be governed by clear mathematical rules and underpinned by network effect. This agrees with our own modelling around bitcoin’s growth over time, with a baseline to value that can be expressed as a straightforward equation.
While this equation cannot hold forever, there is no obvious reason to believe it might fail in the coming 2-5 years. Assuming no ‘black swan’ event, the model suggests minimum prices of $12,000 for the end of 2020, $42,000 for the end of 2022 and $128,000 for the end of 2024. These values do not take into account the effect of a bull market or a speculative bubble. However, the further into the future the line is extrapolated, the more unreliable the forecast becomes.