Some analysts warn that the price of Bitcoin (BTC) could drop further as volatility cools. Others are unsure whether to go for $10,000 or $29,000. Explains the expectations of Bitcoin masters.
“The crypto market is heading towards a big boom”
Justin Bennett, a crypto analyst, has observed the trend in crypto market capitalization excluding Bitcoin. The analyst predicts a major breakout. Bennett is undecided on whether Bitcoin will reach $10,000 or $29,000. The analyst says that the quiet era for cryptocurrencies is about to end. He also notes that the longer a market coils, the more explosive the breakout will be.
Bennett’s estimate is based on the altcoin market cap, which at the time of writing hovers around $518.92 billion. The analyst warns traders to prepare for the breakout. It remains unclear whether the breakout will be up or down. Despite Bitcoin’s correlation with the US stock market, the leading crypto has held steady in the face of falling stock prices and rising inflation.
As you follow on Kriptokoin.com, in the latest minutes of the US Federal Open Market Committee (FOMC), the monetary policy maker has assured that higher interest rates are here to stay. This means that traders will remain cautious in their approach to risky assets like Bitcoin and cryptos.
Bitcoin price $10,000 or $29,000?
Another crypto analyst, DonAlt, has identified key price levels for BTC. The analyst is not sure that the Bitcoin price will rise to the $33,000 level. However, DonAlt says that BTC will hit the $12,000 to $14,000 region, or $29,000 level, which is a common price target for Bitcoin bears.
The analyst explains his strategy to dispose of BTC assets here as the asset will decline at $29,000. Therefore, he considers this level to be a key point in the BTC price trend.
DonAlt’s Bitcoin price targets“Bitcoin could drop further as volatility cools”
For years, Bitcoin has been associated with high price volatility, a factor that keeps most investors away. The situation is changing, however, with Bitcoin being less volatile than traditional investment products such as stocks. Analysts led by Steven McClurg, chief investment officer of digital asset fund manager Valkyrie Investments, say that falling volatility amid suppressed trading volume will be significant for Bitcoin price in the long run, Bloomberg reported on Aug.
As a result, McClurg notes that volatility will likely accelerate further, especially as BTC is weighed down by the prevailing macroeconomic conditions. In this context, McClurg underlines the following:
In a general bear market, you don’t want low volatility combined with low volume. Because we are already in the recession period. We believe it could get worse and the Fed will continue to raise rates and people will start pulling money off the table. And it causes prices to fall faster when there is low volume and low volatility. It is also possible that this will result in higher volatility.
Concerns about low trading volume
Furthermore, ARK Investment Management analyst Yassine Elmandjra reiterates that low volatility during the low trading volume period did not support the leading crypto. Elmadjra makes the following statement:
So low volatility is perhaps an indication that Bitcoin is becoming more boring and less outlier. However, low volatility in low volume may not be great for Bitcoin.
Analysts’ opinion came as Bitcoin’s 30-day volatility continued to drop. It reached 52% after stopping at 64% on an annual basis for months. At the same time, Bitcoin trading volume has dropped below $50 billion after hovering above $100 billion at the start of the year.
Bitcoin and S&P 500 volatility / Source: CoinMarketCapImpact of macroeconomic factors
Specifically, the falling Bitcoin volatility relates to a time when the crypto industry is trading alongside the stock market. The correlation emerged as global central banks continued to raise interest rates to cope with rapidly rising inflation.
The situation has caused most crypto investors to walk away from the space and avoid day trading. In the midst of the suppressed market, volatility cooled as historical speculation faded. Also, BTC has been consolidating at $20,000 for weeks. The trend has led some market players to predict that the asset has bottomed out.
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