The director of research at FalconX, a crypto brokerage firm, predicts that Bitcoin (BTC) will experience significant and volatile upward movements in the coming months.
David Lawant, in a post on X, points out that the current discount on Coinbase’s BTC premium is similar to the conditions in August 2023 when Bitcoin was trading around $25,000 before surging to record highs near $74,000.
“Is it always darkest before the dawn? According to my calculations, the last time the Coinbase premium was this negative was a couple of months before the massive rally from October 2023 to March 2024.”
The Coinbase Bitcoin premium index measures the percentage difference between the price of BTC on Coinbase Pro and its price on the crypto exchange Binance. Coinbase mainly caters to US customers, including large institutions, while Binance serves a more global customer base.
A significantly discounted Coinbase premium index indicates weak buying pressure from US investors, a condition that has historically coincided with Bitcoin price bottoms.
Lawant believes that the next few months will likely witness Bitcoin reaching new heights as he expects US investors to return and bid on BTC.
“Something tells me the next six to twelve months will be splendid – and probably volatile. Let’s see!”
Last month, macro guru Raoul Pal stated that the crypto market is approaching the “Banana Zone,” a period of sustained uptrend for digital assets. He noted that stimulus packages during elections tend to lead to higher inflation and consequently, higher prices for Bitcoin and crypto.
“Look, the backend quarter of an election year is the true banana zone for all assets. It always is. So you know that you’ve got a very, very, very high probability that by autumn things are utterly ripping. I mean, how long before ETH, Bitcoin [and] SOL break their recent highs? It could be two weeks. It could be two months. It doesn’t really matter, but then it accelerates.”
At the time of writing, Bitcoin is valued at $62,113.
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