Institutional accumulation at all-time highs suggests Bitcoin rally to $60,000

As Bitcoin has broken above the $50,000 psychological barrier, buyers exercise optimism for significant gains at the end of the year. 

Analysts expect spectacular gains at the end of year, as BTC bull-run resumes

According to Willy Woo, an influential on-chain analyst, Bitcoin’s bullish break above $50,000 has kicked in the second leg of the bull-run. Woo’s Bitcoin Supply Shock model is a measure of investor demand and supply. It indicates zones of peak accumulation that historically occur before a prolonged price rally. 

When large wallet holders accumulate BTC and resist selling it for a prolonged time, a price rally is triggered by the “scarcity” of Bitcoin, given the demand remains the same. Based on the model, BTC has now entered the zone of peak accumulation by long-term holders. 

The indicator plots the ratio of “coins that cannot be bought” (accumulated by holders) vs. “coins that can be bought” (available on exchanges). The amount of Bitcoin pulled out of circulation five months ago qualifies as “coins that cannot be bought” in the following chart.

Bitcoin Long Term Holder Supply Shock.

In addition to Woo’s supply shock model, the open interest associated with long positions on Chicago Mercantile Exchange (CME) has hit its highest level at $165.7 million. This implies that asset managers across institutions are bullish on the asset. 

Compared to long positions, short positions sit at $74.1 million. This value is substantially low when compared to the peak of nearly $264 million noted ahead of the May 2021 bloodbath. 

Given the bullish outlook of both institutional and retail traders, pseudonymous cryptocurrency analyst @Pentosh1 has predicted that BTC will hit a new all-time high above $180,000. 

Travis Kling, founder and chief investment officer at Ikigai Fund, took a conservative approach in his Bitcoin prediction. Kling has set the next price target at $58,000, calling it “easily attainable.”

With an increasing correlation between Bitcoin and Ethereum, the altcoin is currently rallying alongside the top asset. The narrative of “flippening,” or Ethereum’s market capitalization exceeding Bitcoin’s, is becoming increasingly unlikely. 

@Pentosh1 has predicted that “flippening” is less likely to occur anytime before 2022. 

FXStreet analysts evaluated BTC to predict where the crypto is heading next, setting the next target at $57,000.