Crypto trader and influencer Ben Armstrong is explaining why it is crucial for Bitcoin to hold the $47,000 level.
In a new video, Armstrong tells his 849,000 subscribers that if Bitcoin, which is hovering around $52,000 at time of writing, moves below the $47,000 range, it will be a significant level to have lost considering it has acted as such a strong area of support over the past few months.
“I do not believe that we’re going to see Bitcoin go below the $47,000 area… There has been so much buying volume at the $47,000 number. From institutions, from corporations, from individuals, from retailers – basically, every person under the sun was buying at $47,000.”
However, Armstrong notes that if $47,000 is lost as support and BTC remains above $41,000, it will still be considered a normal bull market correction.
“Can it possibly go below $47,000? Well, yes it can. If it does go below $47,000, then what you’re looking at is a level that’s going to get plunged through that is very very strong. However, that’s still within the range of Bitcoin’s average corrections within bull markets.
So what that means is Bitcoin can go down as low as $42,000… maybe even $41,000 and still be within the normal correction zone of a bull market.”
While Armstrong believes that BTC and the bull cycle could survive a move down below $47,000, it will be difficult for the flagship cryptocurrency to reconquer the level and turn it back into support.
“The thing that’s very bad if it goes below $47,000 is that what we see with these really really strong levels is that once the level gets broken… a very hard line of support will turn into a very hard line of resistance. So I’m worried from that perspective that if we do plunge below this $47,000 level, it would be really hard to get back over it. We could range for a month or so which would not be great for Bitcoin.”
Ultimately, a correction is “fairly healthy for the market,” adds the crypto trader. Armstrong also looks at PlanB’s stock-to-flow model, which compares the amount of a commodity in circulation divided by the amount produced every year, to point out that BTC is right on track to follow the path to $288,000 before 2024.
“If we’re going to look at the stock-to-flow chart, what you can see is that we’ve actually retreated back to the mean. On the stock-to-flow we had been well ahead of this bull market looking like crazy numbers are coming in the future and I still believe that’s going to happen.”
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