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After a deep learning model projected a significant price rise for Bitcoin (BTC) within the next month, the bitcoin industry is humming with conjecture. Though the AI is showing a positive picture, financial analysts advise investors to view the estimate with a reasonable dose of doubt.
Bitcoin Price Stagnant, But AI Model Foresees Bright Future
Bitcoin has been in a holding pattern for the past week, hovering angrily about the $64,000 mark. Many investors are perplexed by this lack of volatility and uncertain of the direction the market will go. But a deep learning model created by top blockchain analytics firm CryptoQuant has thrown a curveball into the mix.
Source: CryptoQuant
Trained on on-chain activity and a large dataset of past price fluctuations, the model forecasts a notable price increase for Bitcoin in the next weeks. The study suggests that Bitcoin might surpass the $77,000 barrier in the next thirty days, therefore attesting to a new all-time high (ATH).
Bullish Metrics Support AI’s Vision
Although the AI’s forecast is quite striking, some analysts are waiting-and-seeing. They highlight a number of positive indicators that would seem to fit the projection of the model. An asset’s relative value is measured by the network-to– value (NVT) ratio, which has dropped noticeably implying Bitcoin may be underpriced.
Source: Alternative.me
Furthermore declining exchange reserves point to declining selling pressure. These elements, together with the projection of the model, create a perhaps hopeful picture for the near future of Bitcoin.
Still, there is a shadow of doubt. Measuring investor attitude in the bitcoin market, the Fear and Greed Index finds it currently firmly in “greed” area. Extremely greedy times have historically usually followed market corrections.
This begs the questions about whether the present price stalemate is a warning of an overheated market ready for a retreat rather than a forerunner to a surge.
Bitcoin is now trading at $62.850. Chart: TradingView
Stalemate Before Potential Breakout?
Daily chart technical study of Bitcoin exposes still more complexity. A major sign of short-term momentum, the price has failed often to exceed its 20-day Simple Moving Average (SMA).
Hanging sideways, both the Relative Strength Index (RSI) and the Chaikin Money Flow (CMF) point to a lack of clear market guidance. These signs suggest that before a possible breakout—either upward or downward—investors may be in for some more days of slow price action.
A Calculated Gamble
Though it’s important to keep in mind that AI projections are seldom perfect, the prognosis of the deep learning model gives some hope for Bitcoin enthusiasts. Though the argument of the model gains weight from the convergence of optimistic indicators, it is impossible to overlook the always present possibility of a market correction motivated by greed.
Featured image from Pixabay, chart from TradingView
