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Analysts React to Bitcoin Dip Below $60k Amid US Rate Freeze, How Low Can It Go?
- Bitcoin has fallen to US$57,433, experiencing a 22% decrease from its March 2024 peak, amid mixed signals on whether to buy the dip.
- Persistent inflation contributes to the crypto market’s current downturn, alongside ETF outflows.
- Analysts predict further declines but remain optimistic about Bitcoin’s long-term growth, viewing the current drop as a potential buying opportunity.
Bitcoin dipped below US$57k (AU$87k) overnight and currently trades for US$57,433 (AU$87,903), 22% below its all-time high of March 2024. So, is the bull market cancelled or is now the time to buy the dip?
After all, the dip buying could end up like this:
First, why are BTC and the whole crypto market – apart from some outliers – crashing?
Most likely factors are the gloomy macro picture which includes persistent inflation and the US Federal Reserve just coming out with no new news. That is, no rate cuts, which hardly surprised anyone.
Related: Market Analyst Pav Hundal Looks at Where Bitcoin May Be Heading Next
There are also the US Spot Bitcoin outflows of the recent weeks and the modest performance of the Hong Kong BTC and Ether Spot products. This is seen as encouraging by some, given the size of the local financial market.
There is also the fact that, prior to the current correction, Bitcoin had been rallying for several months with only minor corrections along the way. So, some analysts have said we may see further movement to the downside for a little while.
Bitcoin, Quo Vadis?
Analyst RektCapital puts things into perspective for us. He points out that in this cycle, the deepest drop was a 23% decrease in value, while the longest lasted 63 days.
Currently, we’re experiencing a pullback that’s 19% deep and has been ongoing for 49 days. Bitcoin is now just 4% and 14 days away from matching the records for both the deepest and longest retracement in this cycle.
But Rekt also adds that the price drop is likely not over and will try to shake out many more ‘weak hands’.
Bitcoin will retrace deep enough to convince you that the Bull Market is over. And then it will resume its uptrend.
RektCapital CryptoTony warns against making impulsive decisions based on short-lived price changes and suggests maintaining focus on larger, more significant market trends and support levels:
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Fellow analyst Dennis Liu, aka VirtualBacon, says embracing the inherent fears of crypto is essential for success, requiring resilience and a readiness to confront financial risks. He added he is fully committed and prepared to tackle any challenges which may arise.
Author
Aaron Feuerstein
Aaron Feuerstein is a freelance writer based in Melbourne. His focus is on decentralised finance and the regulatory space surrounding blockchain. He holds a Master's in Accounting. When he is not studying the latest legal case, he enjoys his time as a modest but eager hobby cook.
