Crypto analyst and economist Alex Krüger is mapping out the current state of Bitcoin.
In a new series of tweets, Krüger says Bitcoin remains in a long-term bull trend. He highlights $9,000 as a crucial area of support, and says if it breaches that level, the leading crypto is likely to move lower in a hurry.
“A break of $9000 would likely see price drop FAST to $8500. Were price to be overextended by then, I’d expect price to bounce there. Were price to consolidate in the $9500-$9000 range before breaking down, I’d expect $8500 to get run over and price to push into the $7Ks.”
Krüger refutes the notion that Bitcoin will inevitably fill its futures gap, which would require a plunge to around $8,500.
“Many are talking about going long around $8,500 in the event of a breakdown. $8,500 is a big level, as it represents the 50% retracement of the 2019 move, as well as filling the Jun/14 weekend CME gap. This gap-fill level is not precise due to the futures basis.
Even though gaps often fill, gaps are not meant to be filled. Gap filling is a combination of random variations (price moves), self-fulfilled prophecy (traders assign value to gaps), and lack of support/resistance within gaps (i.e. no trades inside).
One can find plenty of gaps unfilled throughout history in trending assets. In a bull market, down gaps tend to fill. In a bear market, up gaps tend to fill. Furthermore, CME gaps can be seen as not ‘real’, as there’s plenty volume inside gaps in 24/7 platforms.”
He also lays out the positive and negative factors facing BTC in the summer of 2019.
“Negative factors: Miner profitability is HIGH. Pro miners running S9s have all-in costs (after depr.) in the $5500-$6500 range. Many ‘hodl’ whatever is not needed to cover costs. Newer miners coming online increase difficulty and put pressure on margins, reducing hodling.
Positive factors: Bakkt coming online September 23rd. Fidelity, Ameritrade, ETrade (awaiting news). HNWI & Macro traders interest is up. Macro narratives are up (false, but who cares). Retail interest trending up (though still low). Chinese interest in particular tripled in 2019 [according to Baidu searches).”
As for where BTC will head in the long run Krüger is bullish and says he believes BTC will break through $20,000 in 2020 or 2021, triggering a sharp rise to as high as $50,000.
17/ Bigger picture, the upside is IMO considerably larger than the downside. Think $BTC will eventually break through $20K, in 2020 or 2021, and once it does, it should trade $30K, $40K and $50K fast. Must be long for when that happens, and enjoy the ride as others FOMO in. pic.twitter.com/A2Kv8jQmqU— Alex Krüger (@krugermacro) August 17, 2019