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Bitcoin price may fall by 30% to $ 7,500; Here's why




Over the past week, Bitcoin (BTC) has finally managed to mount a comeback, and the local rally made $ 9,300 to $ 10,500 as of writing this.

However, one analyst recently pointed out that this price action only confirms the idea that the cryptocurrency market may soon undergo a new retracement – one that could bring the Bitcoin price down to $ 7,000 for the first time in literal months.

Related reading: Bitcoin price may break several months Bull Flag

Why Bitcoin Price Could Fall by $ 3000

Il Capo of Crypto, a trader, recently posted the tweet under which shows gold price action (2-day chart) in 201[ads1]2 to 2013 and Bitcoin price action (12-hour chart) from June to now.

As shown below, there are clear similarities between the two charts: a series of lower highs and higher lows, the assets reversed after RSI reached "overbought" levels, and clear interactions with key y Fibonacci Retracement levels.

In other words, the Bitcoin price apparently does exactly what gold did back in 2012 to 2013, which was its peak in the wake of the Great Recession.

Capo writes that the entire fractal should play out, meaning that BTC will soon lose support of ~ $ 9,500, a fall to $ 7,200 to $ 7,500 – an important Fibonacci Retracement support – should play out. That would represent a 30% drop from the current $ 10,500 level.

Capo is not the only analyst at present expect Bitcoin to potentially be further disadvantageous. According to Jack, the lead analyst in a trade and analysis group known as Bravado, the most likely scenario for BTC is "bleeding us way to $ 7400 in a falling wedge" to the bottom in early November. He points out that BTC is clearly in a sinking wedge with a downward sloping wave background, and suggests that further correction is possible.

However, while the fractal and the techniques point to price action, the basic factors suggest that the demand for Bitcoin should only grow, potentially setting off any significant retracement.

Related reading: Crypto Pundit Peter Schiff says gold is in early bull market, but Bitcoin is a Sucker's Rally

As previously reported by NewsBTC, Adam Back, creator of the Proof of the Work Protocol on which Bitcoin mining is based, recently outlined a number of reasons why BTC is ready to appreciate the coming years. They are as follows:

  • The May 2020 Bitcoin Rewards Reduction from 12.5 to 6.25 BTC per block : In May next year, the number of coins issued per block (every ten minutes) will be cut in half, which results in a negative supply shock for the Bitcoin market.
  • Geopolitical uncertainty : Venezuela has collapsed when a regime has managed to blow away the local currency, leading to local adoption of Bitcoin and other decentralized forms of money. Argentina recently saw its incumbent president, Mauricio Macri, lose the primary election for the presidential election, resulting in a collapse of the Argentine peso and the local stock market. Hong Kong has been surrounded by massive protests as China has waged a trade war with the states. These cases are just one of many showing that the world is unstable and needs assets in a safe haven, be it gold or Bitcoin.
  • $ 17 trillion worth of negative returns : On Friday, Bloomberg reported that the negative-improving bond situation has just evolved. Their report, which cites Bloomberg Barclays Global-Aggregate bond index, shows that $ 17 trillion bonds are negative gearing.
  • Modern Monetary Theory (MMT) becomes a popular trend : MMT, which is effectively an economic framework that states that governments should heavily use fiscal policy to boost the economy, has become a popular trend in global politics. Many critics of the theory say it will lead to mass inflation, which will lead to an increase in the valuation of hard money, such as gold and potentially Bitcoin.

While some of these factors do not yet have an impact on the cryptocurrency markets; the others have.

  Featured image from Shutterstock 





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