Bitcoin Price Prediction 2021–2022 using Simple Moving Averages
Bitcoin has been soaring high after hitting the bottom close to $ 3156 in December of 2018. The rally picked up speed in October and September of 2020. The new year was greeted with massive gains and returns. But recently Bitcoin can be seen making lower highs and lower lows after hitting the $64K mark and many retail investors and day traders are speculating that the market top has been attained and now it is the time for the bears to take charge.
Is it the Top?
In the past, we have seen massive corrections in bitcoin which can reach up to a 30 to 40 % fall in prices.
If we look at the weekly chart, we have had close to 35% correction till now if we calculate from the top. No doubt things are looking a bit bearish but let us analyze some data to see what the numbers tell us for a long-term scenario.
Price Prediction using Simple Moving Averages
For predicting the bitcoin cycle top we will be using simple moving averages.
First, we will be calculating the simple moving averages for the bitcoin price at the peak of every cycle, and using the SMA we will predict the cycle top for the 4th cycle. Moving averages will take into account the diminishing returns of bitcoin and will not inflate the cycle top price.
Applying SMA on the peak prices 31.9, 1163, and 19666 we can forecast the bitcoin cycle top to be close to 154240. Bitcoin in 6 digits is not bad!
In the above chart, we applied SMA to the bitcoin multiplier values such as 3987.5, 523.87, and 129.04. This gave us the expected multiplier at 59.59 for this cycle. Multiplying the expected multiplier with the bottom price before the peak puts the expected bitcoin value at 186040. Again not bad!
Also, if we apply the moving averages to the length of cycles, we can forecast that this cycle will last approximately 1257 days i.e. somewhere near the middle of the next year.
We do not believe that bitcoin will cross the 300K mark this bull cycle simply because if we observe the past cycles, the return over each cycle has diminished. I would love to be wrong but this is what the data suggests at the moment.
The Conclusion
We have used a very basic simple moving averages method to predict the bitcoin cycle top. Analysts use advanced models considering many other factors as well. Also, at this moment we do not have enough data to strengthen our model as bitcoin has only completed 3 cycles till now. But if we consider this model, we could see bitcoin prices anywhere between 150K to 180K this bull cycle next year.
For more amazing content on Cryptocurrency follow Cryptocase on:-
Instagram
Pinterest
Note- Cryptocase is not a financial advisor and the above is not financial advice. The information is solely for educational & informational purposes only. Cryptocase is and shall not be responsible for any profit or loss incurred by you
