Bitcoin in an ongoing bear market has confirmed a weekly breakdown from its multi-month consolidation range but remains in an uptrend as long as it stays above $38,000. As Bitcoin price hovered around $55,422 on Monday during the early European session, the fear and greed index dropped further towards 28, suggesting more fear.
When will the market recover and is there any hope in the coming months? Let’s find out.
How Low Bitcoin Price to Go?
This breakdown introduces the possibility of lower price targets, although a return to the previous consolidation range would require a weekly close back within the range, which is less likely given the current close. The weekly RSI is approaching the August/September 2022 lows, and another red weekly candle could set up a potential bullish divergence.
Moreover, for the first time since last October, Bitcoin price consistently closed below the 200-day Moving Average (MA) in the past five days. If BTC reclaims the 200D SMA as a support level, it can increase the chances of a bullish recovery during Q4.
Why is the Bitcoin Price Tanking?
Bitcoin has faced recent bearish pressure due to increased whale selling. The German government offloaded over $85 million in Bitcoin, and US-based Bitcoin ETFs saw low demand. Miners are also selling BTC to cover costs. The market is now seeking economic clarity from the US Federal Reserve, with expectations of a rate cut later this year and a general election potentially sparking a crypto-bullish outlook.
Analyst Finds a Ray of Hope
Ash Crypto recently highlighted a major upcoming event that could drive the crypto market to new heights: the distribution of over $16 billion in stablecoin liquidity. This liquidity boost stems from FTX’s plan to reimburse its creditors, a development that could set the stage for significant market growth in late 2024 and early 2025.
The key dates to watch are August 16, when FTX customers will vote on the distribution plan, and October 7, when Judge Dorsey will decide on its approval. If approved, the reimbursement process will begin in Q4 2024 and continue into Q1 2025.
This massive influx of funds coincides with other bullish market factors, such as potential rate cuts, new FASB accounting rules, and US election results, all of which could further boost the crypto market.
Ash Crypto believes this $16 billion injection will act as a powerful catalyst for higher crypto prices. Bitcoin is projected to surpass $120,000, Ethereum could climb above $12,000, and many altcoins might experience 10x-50x growth. For those keen on capitalizing on this opportunity, now is the time to stay informed and prepared for the upcoming market surge.
While the exact impact of this repayment is unknown. What are your predictions for the impact of this $16 billion distribution? Bullish or Bearish? Tell us.