The price of Bitcoin has been on a roller coaster ride over the past few months. The cryptocurrency was trading in the mid-20s at one point and then plummeted to lows below $8,000. Now it’s back up near $10K again but traders remain cautious with some even predicting an imminent drop to around $3800 before going back up again.
When will crypto peak in 2021? That is the question that has been on traders minds for a while now. The drop to $38K is not the worst case scenario, but it would be a huge blow to the market. Read more in detail here: when will crypto peak in 2021.
On January 6, the ramifications of the Federal Reserve’s recent aggressive statements about rising interest rates as soon as March weighed hard on the cryptocurrency market. The Crypto Fear & Greed Index has dropped below 15, prompting some traders to fear the commencement of a lengthy bear market.
Fear and Greed Index for Cryptocurrencies. Alternative Source
Bears attempted to challenge the lows set on January 5, bringing BTC price down to $42,439 during early trading on January 6. Data from Cointelegraph Markets Pro and TradingView shows that bears attempted to challenge the lows set on January 5, bringing BTC price down to $42,439 during early trading on January 6.
Daily chart of BTC/USDT. TradingView is the source of this information.
Take a peek at where experts believe the price will go in the next days.
Bitcoin’s low point might be between $38,000 and $40,000.
According to Mike Novogratz, the CEO of Galaxy Digital Holdings and a vocal cryptocurrency supporter, the recent drop “has been on low volume,” highlighting the fact that there is “a significant amount of institutional demand on the sidelines.”
When asked whether he thinks the present market circumstances are a good time to purchase crypto, Novogratz told CNBC that “he’s waiting a bit longer to buy crypto” and that the market would “be tumultuous over the next several weeks.”
According to Novogratz,
“Bitcoin may find a bottom between $38,000 and $40,000.”
BTC is attempting to set a new low.
Crypto expert and anonymous Twitter user Rekt Capital provided a deeper look at recent BTC price activity, posting the chart below comparing current market circumstances to those witnessed the previous time BTC price went below its 50-day exponential moving average (EMA).
1 week chart of BTC/USD. Twitter is the source of this information.
BTC “has diverged below the blue 50 EMA” and is now attempting to record a new higher low (HL) as depicted by the green dashed line, according to Rekt Capital.
According to Rekt Capital,
“When BTC deviated below the 50 EMA in May 2021, it established a Higher Low (orange).” BTC initially held the HL, but wicking below it was also prevalent.”
Rekt Capital anticipates the potential of BTC plunging towards the $40,000 region based on the circled portion of the above chart.
Bitcoin price rises beyond $42,000 as order book imbalance becomes ‘insane’
The price of Bitcoin is in the “golden pocket.”
Independent market expert Scott Melker supplied a last piece of research emphasizing the market’s key juncture, posting the chart below, which shows BTC trading between the 0.65 and 0.618 Fibonacci retracement levels.
1 day chart of BTC/USD. Twitter is the source of this information.
This region is regarded as the “golden pocket,” according to Melker, and “is considered the most feasible spot to go long or short an asset and hope for a reversal.”
According to Melker,
“Price is in the golden pocket of the climb from $28,600 to $69,000 right now.”
The total cryptocurrency market capitalization is currently $2.077 trillion, with Bitcoin commanding 39.5 percent of the market.
The author’s thoughts and opinions are completely his or her own and do not necessarily represent those of Cointelegraph.com. Every investing and trading choice has risk, so do your homework before making a decision.
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The “bitcoin is about to explode” is a statement that has been made by many traders. The drop from $10,000 to $38K could be the worst case scenario for Bitcoin.
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