After our previous article predicting a possible heavy correction day, here we are today witnessing a strong selloff. This correction day in the cryptocurrency market comes right after Elon’s tweet stating that Bitcoin is very expensive, and even called it a bit less bullshit than Cash. Regardless of what happened previously, let’s try to see the future instead of weeping from past news. Should you start buying, hold your cryptos or sell everything? Very good questions, let’s find out.
Bitcoin Price falls more than 20%
This correction day comes as no surprise to all CryptoTicker’s community, as we discussed how an overvalued asset, coupled with bad press, can turn sour. That’s why you should first and foremost, subscribe to our Telegram channel (shameless plug).
Now for Bitcoin. Since BTC still has a significant dominance over the cryptocurrency market (currently at 62.5%), any direction in BTC price will most definitely be reflected in altcoins. Bitcoin was eyeing 60K but failed to reached its target amidst Elon’s “betrayal”. But come to think of it, many fundamental news became quiet redundant, as media started to recycle the same headlines over and over:
The price kept rising way higher than the actual value of Bitcoin should be, and that’s what caused prices to fall:
Bitcoin dragged Cryptos to this Correction Day!
Before tackling Bitcoin’s price prediction, let’s take a quick look at the overall cryptocurrency market. It seems to look very similar to BTC’s price chart no? Go look again…figure 1 and figure 2. Well, you guessed it, Bitcoin is still strongly correlated with the overall market thanks to its 60%+ market dominance. So far, the cryptocurrency market lost exactly 20%, just like BTC on this very correction day.
Bitcoin Price Prediction – Where will prices go?
Now that the big elephant in the room is addressed, let’s take a closer look at where can we expect potential BTC prices to reach. So far, a retracement towards the USD 45,000 price level was an obvious prediction, as the latter was the only real support area and represent exactly the 40% Fibonacci Retracement level. In case prices fail to bounce back, prices might reach the 61.8% price level of USD 40,500, which coincides with a previous resistance area.
If you think about it, Bitcoin was bound for a healthy price breather. Prices can fall back all the way to USD 40,000 and BTC can still be considered on an uptrend. In figure 3, we can clearly see a normal retracement back to the uptrend line. If prices break below that green uptrend line, only then, we can start talking about a trend reversal and a start of a downtrend. For the current moment, hold tight through this correction day, and don’t think of buying the dip just yet.
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Rudy Fares
