Beware the Bitcoin Bear: Analyst Predicts Prolonged Slump
Bitcoin (BTC), the leading cryptocurrency, has plunged to levels reminiscent of early 2023, sparking uncertainty among investors.
The question looms whether the sub $20,000 range will resurface.
Mike McGlone, Bloomberg’s Senior Macro Strategist, parallels Bitcoin’s path and the 1930 US stock market crash. The downward trend in Bitcoin‘s 100-week moving average (MA) chart is noteworthy.
This, combined with the principle of not opposing the Federal Reserve (Fed) and potential asset regression, warrants consideration. US Treasury two-year notes yielding almost 5% present a new challenge to Bitcoin.
Born after the 2008 crisis, Bitcoin faces a prolonged retracement period amid shifting global interest rates. The appeal of a digital gold equivalent diminishes with more secure assets offering a 10% total return over two years. The historical significance of a 5% yield on US Treasury notes suggests challenges for high-risk assets. McGlone’s analysis underscores Bitcoin’s declining trend in comparison to Treasury yields.
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Material Indicators’ Keith Alan advises caution, anticipating potential retesting of sub-$20,000 levels. Despite short-term scalping possibilities, Alan advocates limited exposure to preserve capital for an eventual buying opportunity, emphasizing that Bitcoin’s bottom hasn’t been reached. His chart highlights various downward ranges.
The Bitcoin market faces a critical juncture at $25,000 support, the failure of which could lead to revisiting the 2017 peak at $19,800. Concerns persist regarding continuing downside momentum, possibly reaching a four-year low of around $13,800. This shift surprises bullish investors, given the perception of ending crypto winter.
Bitcoin’s momentum has shifted, prompting bulls to defend support levels against an extended decline throughout the year. Although briefly regaining the $26,000 threshold, BTC remains down by over 7% in the last 24 hours.
Alexander Stefanov
Reporter at CoinsPress
Alex is an experienced finance journalist and a cryptocurrency and blockchain enthusiast. With over five years of experience covering the industry, he deeply understands the complex and constantly evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His passionate approach allows him to break down complex ideas into accessible and insightful content. Follow up on his content to be up to date with the most important trends and topics - stay ahead of the curve with CoinsPress.
