Cryptheory: NFT, Play-to-Earn, Crypto News

24/7 crypto news, cryptocurrency meaning, guides, learning, #cryptohelpschildren

BTC could face three years of bear market if price drops to $10,000

2 min read

 

With the recent market devaluation, part of the investors already expects a more lasting bear market. One of them is Gareth Soloway, chief strategist at In the Money Stocks, who gave his view on the market.

According to Soloway, the BTC can still recover and return to the levels of US$ 30 thousand. However, the current scenario would be a “bull trap”, i.e. a false bullish move. Subsequently, BTC would fall again and, if that happens, it should reach the $10,000 region.

For the strategist, this movement should occur until the end of the year and will mark the beginning of a long cycle of decline. In this sense, Soloway expects that the price of BTC will only appreciate again after 2025.

Recession should aggravate movement

Market continues to show signs of pessimism, especially after the speech of the President of the Federal Reserve (Fed) on Wednesday (22). Jerome Powell warned that the Fed must step up interest rate hikes to contain inflation.

But high interest rates tend to slow down the activity of the economy and even generate a recession. For Soloway, if a recession occurs, the cryptocurrency market is unlikely to see a new high in the short to medium term.

“There are a lot of people placing stops just below $20,000, and it’s a tendency for a market to execute those stops. It makes people freak out, weaker investors start selling, and finally you get a short-term fund. I still see more downsides. I still think we’re going to drop to $12k and that a price below $10k is very possible,” she said.

Bear market

The ‘crypto winter’ is affecting everyone, including institutional investors and the world’s top exchanges. the index Crypto Fear & Greed Index hit 7 last week, one of the lowest levels in history, and investors are not putting money into the market.

Therefore, a prolonged bear market is a great possibility to happen. In fact, this is the norm within halving cycles in the price of BTC.

In the first cycle, which started in 2012, BTC was almost four years in a downtrend. After registering its first all-time high in 2013 (around $1,100), BTC only surpassed $1,000 again in 2017.

In 2016, when the second halving took place, BTC reached its all-time high in December 2017, when it reached almost $20,000. But the price only returned above this level in November 2020 – almost three years later.

If Soloway’s prediction comes true, BTC will follow a path similar to the 2016 halving cycle, in which the price only rose again the year after the cut in the issuance of new BTC.

Times Square will arrive in The Sandbox metaverse

All content in this article is for informational purposes only and in no way serves as investment advice. Investing in cryptocurrencies, commodities and stocks is very risky and can lead to capital losses.

Leave a Reply

Your email address will not be published.