Read full article at Bitcoinist.

PlanB has clarified that the $98k Bitcoin target for November isn’t based on the famed S2F model, but on his “floor model.”

PlanB: $98k Nov Prediction Isn’t Based On S2F Model

Earlier in the year, analyst PlanB tweeted out some price targets for Bitcoin for the coming months. Most of these predictions have ended up being decently accurate, but one target in particular might not be met as things stand currently.

Here are the price predictions in question:

As you can see, PlanB’s target for November is $98k. However, it’s already 18th of the month, and Bitcoin hasn’t shown any strong momentum up yet.

Rather, the coin has declined below $60k in the last few days, and has so far shown no clear signs of recovery. As things stand, BTC will need a more than 60% jump to close in on the target, and that too within just 12 days.

Here is a chart that shows the current trend in Bitcoin’s price:

Bitcoin Price Chart

BTC's price plunges down in the last few days | Source: BTCUSD on TradingView

Because of this, some people in the crypto community have started questioning S2F, a price prediction model that the analyst is most commonly known for.

Related Reading | How Did Bitcoin’s “Big Week” Turn Out?

As a response, PlanB posted a tweet yesterday clarifying that the aforementioned price targets aren’t based on the S2F model.

Instead, those targets seem to be based on the “Floor model,” another of the analyst’s tools. Therefore, as the tweet explains, if the $98k target for this month indeed doesn’t end up happening, the S2F model still wouldn’t have failed.

What Is The Bitcoin Stock-To-Flow Model?

The S2F, or stock-to-flow model in full, is a price prediction method that’s based on the ratio of the supply (stock) to the the annual production (flow).

Related Reading | Mining Stocks Outperform Bitcoin As Miner Profits Continue To Rise

The model can be applied on any limited asset, whether that be Bitcoin or metals like gold and silver. It makes use of the fact that assets like these will continue to get scarce as time passes.

Below is the latest chart for the BTC S2F model.

The actual BTC price vs stock-to-flow model predictions | Source: buybitcoinworldwide

As the above graph shows, while there have been some areas of deviation, the model has been overall quite close to the real thing so far.

The floor model, which the earlier predictions were taken from, is a different method from S2F, and it’s based on price and on-chain data.

In the replies to the tweet, PlanB explains that stock-to-flow’s prediction for this Bitcoin cycle is an “average” price of $100k. Because of this, it’s hard to say right now at which level the model might be considered invalidated.

Featured image from Unsplash.com, charts from TradingView.com, buybitcoinworldwide.com

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