The price of Bitcoin has seen continuous decline lately, after hitting the $71k price mark a few days ago, as several analysts predict bearish sentiment.
As the market experiences a price decline, dropping by 10% from its recent record high, traders are bracing for potential dips, amidst ongoing market volatility and concerns over inflation.
With the price of Bitcoin currently trading at $67,250, as at the time of writing this report, this downward trend is attributed to several factors such as broader market movements and mounting fears of inflation.
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Amidst the bearish sentiments, analysts are predicting further declines in the near term. Founder of MN Trading Consultancy Michael Van de Poppe, predicts that Bitcoin could potentially decline to the $60,000 range, citing upcoming economic indicators such as FOMC meeting and CPI data as potential catalysts for correction.
Also speaking, Acclaimed financial analyst Peter Schiff has long expressed apprehension about Bitcoin’s stability, attributing fluctuations to heavy reliance on exchange-traded fund (ETF) investments. Schiff contends that the digital currency’s market depends too heavily on institutional money that flows in and out. As ETF shareholders eventually sell their holdings, Schiff warns, the cryptocurrency could experience sharp
declines that destabilize prices.
Notably, crypto traders are keenly scrutinizing the Federal Reserve’s coming final choice, which could further affect Bitcoin’s price course. A rise above the $68,500 marker could denote retrieval, while a slide underneath the $66,000 mark could signify a further downturn.
Analysts noted that although the current dip was steep, longer-term models still point to wider adoption, affording Bitcoin protection against macro volatility.
Meanwhile, the anticipation of a market correction is not without precedent, as historical data indicates that Bitcoin often experiences significant price adjustments ahead of key economic events. This pattern of pre-event volatility has become a familiar sight for seasoned investors, who understand the importance of closely monitoring market indicators and economic announcements for insights into Bitcoin’s future trajectory.
Despite the current support level at around $65,000, analysts caution that weak bid liquidity could exacerbate the downward pressure on Bitcoin’s price. Material Indicators, a leading trading resource, cites a lack of significant bid concentration below $60,000, suggesting that Bitcoin’s price may face additional challenges in finding support levels in the coming days.
From a technical standpoint, Bitcoin’s immediate support rests at $65,000, with a breach of this level potentially triggering a further decline towards the 200-day EMA at around $63,934. The critical support zone between $62,800 and $64,815, marked by the 50-day EMA, holds significance as it previously catalyzed a surge in Bitcoin’s price.
As traders/investors navigate through a period of heightened volatility and uncertainty, they are urged to it’s essential approach trading with caution and a thorough understanding of market dynamics. While short-term price fluctuations may test investor confidence, the underlying fundamentals of Bitcoin remain robust.