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More downside predicted for Bitcoin

by Jonathan Adams
Bitcoin

This rejection at a crucial resistance zone ($10,000) has confirmed to a number of analysts that more downside is likely

Bitcoin has seen a sharp correction after tapping $9,800 during Monday’s trading session. The cryptocurrency now trades for $9,300 — more than 5% below the highs.

This rejection at a crucial resistance zone ($10,000) has confirmed to a number of analysts that more downside is likely. A historically-accurate trader went as far as to say that the entire crypto market will see a minimum correction of 25%.

The fact that BTC has managed to hold the $9,000s for nearly two months now has been a bullish sign to some. They argue that the consolidation is extremely similar to that seen at the start of BTC’s last bull market.

Bitcoin dropping by 25% from current prices would result in a price of $7,000. And Ethereum doing the same would mean a move to the $175 region.

The trader predicted that Bitcoin would retrace to $6,400 when no one thought that would happen. He has also made a number of accurate medium-term predictions, calling that BTC would top its 2020 bull trend around $11,000.

Supporting the expectations of an impending move to the downside is ByteTree’s Charlie Morris.

1-week network velocity down to 454%, 5-wk 556%. Tx value down, av tx size down, fees down, MRI shot to pieces. Why the lack of interest? Can’t see price holding up. Fair value <$7k, Morris wrote.

Although Bitcoin may have a fundamental and technical case for a correction, strength in the S&P 500 could negate that trend.

As observed by JPMorgan earlier in June, “Cryptocurrencies have traded more like risky assets like equities—a significant change relative to the prior couple of years.”

Important
This article is for information purposes only.
Please remember that financial investments may rise or fall and past performance does not guarantee future performance in respect of income or capital growth; you may not get back the amount you invested.
There is no obligation to purchase anything but, if you decide to do so, you are strongly advised to consult a professional adviser before making any investment decisions.

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