Top Bitcoin Analyst: $7,970 is Possible but a BTC Bottom is Not In

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Quick take:

  • Top Bitcoin analyst cautions that a Bitcoin bottom is not in.
  • BTC might retest $7,970 in the right environment.
  • However, if the stock market crashes again, BTC will also go down.

The Bitcoin halving is approximately one month away and BTC is currently holding the earlier mentioned $7,200 – $7,300 support zone. The narrative of BTC’s price experiencing massive gains before this event is slowly losing steam due to the global economic impact of the Coronavirus. The COVID19 pandemic has been described as the needle that broke the Camel’s back when it comes to the traditional markets. This global economic crash had been predicted months before by analysts such as Jesse Colombo who is for the opinion that a V-shaped recovery is not possible.

Bitcoin Has not Yet Found a Bottom

In a recent Tradingview post, popular Bitcoin Analyst, @MagicPoopCannon, expressed a similar view that we are in the midst of a global recession. He explained that the stock markets have experienced a local top and a correction in the form of a recession has just begun.

Bitcoin and the crypto space continue to rally, as investors react to evidence that the coronavirus is slowing down. However, this is simply a bear market rally. Knowing that, it’s extremely important for cryptocurrency investors to understand that we are only in the BEGINNING STAGES of a massive recession/depression. The stock market has put in the final top.

In his analysis, he added that Bitcoin has not bottomed given that the traditional stock markets are yet to also bottom. He explained that BTC and cryptocurrencies are a ‘risk on’ investment and investors will continue keeping their distance if the stock markets continue on their downward trajectory. He added that retail investors will most likely liquidate their BTC and crypto holdings to cater for basic needs as the economy continues to slide deeper into recession.

$7,970 Is Possible

In terms of value, Magic postulated that Bitcoin could revisit $7,970 if it closes a daily candle above the 50 day MA. He explained that at this value, there is a convergence of the 200 day moving average and the 61.8% retracement level.

If we close a daily candle above the 50 day MA, I think there is a decent chance that BTC could run up to the 61.8% retrace, as it converges with the 200 day moving average (in purple) right around the 7970 level.

Conclusion: Cautious Optimism

In all EWN’s recent Bitcoin analyses, we have expressed cautious optimism with respect to the value of BTC. With the additional analysis of Mr. Colombo and Magic, we can conclude that the need to be cautious is still evident given that we do not know the long term economic effects of the Coronavirus on global economies.

What we do know is that there will be some sort of inflation in the coming weeks or months. Bitcoin has never experienced the financial environment we are in right now. Therefore, for there to be some light at the end of the tunnel for BTC, there is surely going to be some tense days ahead in the crypto-markets.

The team at Bitmex is of a similar opinion as explained in their latest report which concludes the following.

In such an economic environment, with high inflationary expectations, gold looks set to shine. But what about Bitcoin? Bitcoin has crashed by almost 53% (peak to trough) in the 2020 Coronavirus crash, as investors raced to the US Dollar.

In many ways this was inevitable. Where the Bitcoin price may shine is in the volatile inflationary aftermath of the response to the crash. In our view, in this changed economic regime, where the economy and financial markets are set loose, with no significant anchor at all, not even inflation targeting, it could be the biggest opportunity Bitcoin has seen, in its short lifetime.

(Feature image courtesy of Oscar Sutton on Unsplash.)

Disclaimer: This article is not meant to give financial advice. Any additional opinion herein is purely the author’s and does not represent the opinion of Ethereum World News or any of its other writers. Please carry out your own research before investing in any of the numerous cryptocurrencies available. Thank you.

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