Bitcoin takes the possibility of crossing the $40k resistance from the bulls after the sudden drop. With the opening of Wall Street on Wednesday, a sharp decline was seen in the stock markets, where shares such as PayPal, Netflix, Tesla lost serious value. How can non-market developments affect cryptocurrencies? We have compiled the market comments of 2 expert cryptocurrency analysts for Kriptokoin.com readers.
“Bitcoin may never see $30,000 again”
Justin Bennett thinks that discount hunters hoping to buy Bitcoin at $30,000 will likely be disappointed. In his recent tweets, he said he doubts investors will ever be able to buy BTC this cheap again.
The analyst says that the dollar index (DXY), which compares the USD to a basket of other fiat currencies, plays a big role in the crypto markets. Generally, a strengthening DXY can signal weakness in many cryptocurrencies, while a struggling DXY often suggests higher prices. According to Bennett, crypto investors may want to closely follow the trend change occurring in DXY to start a new bull run in the market:
DXY is still falling. Probably $95.50 next. A close below 94.60 is needed to reverse the trend.
The analyst recently said that he does not think the crypto bull market is over, contrary to what some say. While there is a short-term volatility, Bennett says the crypto will have another “meltdown” rally sometime this year:
I don’t think the crypto bull market is over. Markets don’t crash when everyone is waiting, and everyone is waiting for it right now. I expect another meltdown this year, followed by a fix in late 2022 or 2023. This means we may be in for more volatility in the short-term if the stock market is to strongly arm the Fed to stay aligned longer.
Analyst Guy assesses the development of the crypto market
Another Youtube analyst, Coin Bureau host “Guy”, thinks that the crypto market is in a completely different place than it was during the 2018/2019 “crypto winter”. The analyst notes to his 1.92 million subscribers that the two timeframes are “almost incomparable”:
Markets have evolved. More and more people know about crypto. More and more people are using crypto. Investors are different. Investors invest based on different theses. The conditions that led to the last crypto winter are nowhere to be found.
Guy argues that prices are currently falling due to external factors, as opposed to the big bang of ICOs that caused a price drop in 2018:
Markets are currently falling due to factors far outside the crypto market. A global pandemic and monetary stimulus not seen in over 100 years is likely to have major implications for nearly all asset classes, and crypto is no different. In fact, one reason we’re seeing these movements is precisely because crypto has become such an investable asset class. Institutional investors who allocate to equities now take overall risk off the table. ETH and Netflix do not differentiate between Bitcoin and Tesla. They’re worried about the Fed’s interest rates, the war with Russia, supply chain disruptions, pandemic variables – it’s a global macro landscape and crypto is catching on.
The analyst also notes that there is a different regulatory and political landscape for crypto. While China had a huge impact on the crypto market in 2018, Guy argues that the country is now “increasingly irrelevant” to the field, citing the recent Bitcoin (BTC) mining ban.
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