After hitting a daily low of $19,309 on July 5, BTC recovered to retake support near $20,400 as the bulls and bears fought over market control.
A widely followed crypto analyst speculates on the future of Bitcoin after the recent two-month gain by comparing its price movement to that of a single traditional stock.
Tesla and Bitcoin-divided pair
The unnamed host of InvestAnswers discussed mean reversion and highlighted Tesla in a new mechanism session for his 442,000 YouTube followers. This statistic predicts when an asset’s value will eventually return to its long-term average.
He pointed out that if one inspects the duo, it’s clear that the current price is trading at approximately 0.036 for this Bitcoin pair. Thus, it is expected to reverse back to its previous level by the end of the year.
Does this imply that the change is long overdue? A blue line can be seen when viewing this graph. We’re currently trading around 0.036, which is close to the 200-day moving average at 0.024. Tesla has remained constant for the last 12 months, whereas Bitcoin has decreased by 70%.
According to the analyst, most assets with inherent worth and utility will revert to the average. Because of this, he is adamant that starting in the second half, both Tesla and Bitcoin will rally.
“Short and to the point, no financial advice; everything implies returns until it’s a piece of junk or is broken.”
Throughout the recession and downturn, Tesla has performed remarkably well. While it can be predicted Tesla will reach $1,200 during the next 6 to 12 months, which is a little over double, he also predicts Bitcoin will likely quadruple during that period. So six to twelve months, or until the summer of 2023, is a very conservative estimate.
Currently, the value of the Tesla/Bitcoin pair is 0.036
Is Tesla in trouble?
On the contrary, the chart guru said that Tesla’s present Bitcoin holdings would result in significant losses for the corporation in future earnings.
He added that they would be severely hit and incur a $450 million impairment cost.
Furthermore, he also thinks the pair will stumble soon and argues that as the bids start to come back, investors should keep an eye on the 0.036 level since it’s possible that Bitcoin will be bought at this price, and Tesla may drop even further.
Bitcoin is currently trading at $20,258 and has increased its daily value by 6.02 percent as per the latest reports.
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Source: https://coinpedia.org/bitcoin/bitcoin-btc-price-could-potentially-triple-in-next-6-12-months-heres-why/