Experts Predict Bitcoin (BTC) Will Fall Below $5,000 Before A Big Rally
Bitcoin and the entire crypto market has suffered huge declines from the prolonged bearish period since recent all-time highs. Nonetheless, experts are predicting a further decline before Bitcoin finally breaks out.
Analysts predict bear trend will continue
Some analysts, including Bitmex CEO Arthur Hayes, have predicted that Bitcoin (BTC), which exchanged hands for as high $20,000 in December 2017, could fall to as low as $5,000 or even $4,000 before bouncing back.
Erik Voorhees, the CEO of ShapeShift and cryptocurrency investor Anthony Pompliano, also known as Pomp, echoed the sentiment of Hayes, stating that the bear market of Bitcoin is not over just yet.
On CNBC Crypto Trader, hosted by Ran Neuner, Voorhees said:
“I don’t expect it (bear market) to end soon, although I do think THAT the rate of collapse has slowed considerably. Generally, in these bubbles, after you go through several months of a downtrend you hang out in a range for a while… But I think we are done with a majority of the collapse.”
Voorhees further noted that while the bear market of Bitcoin has evidently not ended, the worst part of the correction has slowed down.
Voorhees’ prediction can be referred to as optimistic when compared to that of Pomp. He believes that the price of BTC will fall to the $3,000 region before recovering to the $10,000 resistance level.
Pomp wrote in his last newsletter:
“The final data outputs left me with a few uncomfortable conclusions. The most notable one is that we are likely to see Bitcoin near $3,000 before we see Bitcoin at $10,000 again. If this is true, that means we still have ~50 percent price decrease to go. Things may get really, really ugly if this happens,”
While permabulls remain generally pessimistic about the short-term trend of Bitcoin, Fundstrat’s Tom Lee reaffirmed his Bitcoin price target for December 2018.
Bitcoin’s stability is positive news
The researchers at Diar last week reported that the rate of Bitcoin’s volatility has dropped to a 14-month low, stabilizing in the mid $6,000 range since August 6, for around three weeks.
Bitcoin traditionally requires a period of stability before a big rally can be initiated; references can be drawn from the previous 80% corrections and rallies in 2012, 2014, and 2017.
This means that the stability demonstrated by Bitcoin (trading in the range of $6,300 to $6,700 over the past three weeks) is positive.
Institutional investors to support the big rally
Over the last couple of months, we have seen increased interests from institutional investors and Wall Street firms in the growing crypto industry.
We have already seen moves from the likes of Goldman Sachs, banking giants Citigroup and Barclays, PricewaterhouseCoopers (PwC), and most recently Ernst and Young.
Romal Almazo, Cryptocurrency Lead at Capco, told Express.co.uk that tier 1 banks and financial institutions are starting to consider their options in regards to the cryptocurrency market, and their entrance would be felt.
“Any signs of the big players entering the market will cause huge waves. Though my personal belief is that we ARE still a few years away from reaching this tipping point, we are in what I would refer to as an exploratory phase when it comes to institutions and crypto.”
Almazo further explained that there are still some obstacles hindering the entrance of tier 1 banks and institutional investors. He, however, noted that the infrastructure to accommodate them is currently being built.