Jurrien Timmer, Fidelity’s director of global macro, says bitcoin is drifting toward the lower edge of the model he’s used to track it for years.
This model is the power law, which plots the entire price history of bitcoin on a logarithmic chart bounded by three curves – an upper resistance line, a middle trend line and a lower support line that has captured all major bottoms since 2015.
On Timmer’s latest chart, the support line is near $58,000, and bitcoin at around $62,700 is closing in on it.
The bottom panel is where he expects accumulation. It tracks how far bitcoin is trading above or below the power law trend line, and this gap has risen to negative 56%, a depth that the chart indicates the accumulation zone and one that aligns with the 2018 and 2022 lows. The 52-week reading of the bitcoin-to-gold ratio has fallen just as far to around negative 100%.
Timmer does not call a bottom yet. He has said that the speculative premium that pushed bitcoin past $120,000 last year is largely gone, that global money supply growth is slowing and that he sees no catalyst for a turnaround until liquidity returns.
