Bitcoin is down again, and the slump just doesn’t seem to stop for the king coin of crypto. It has ended the past EIGHT weeks in losses and looks set to continue the rut. There is good reason for maximalists to be afraid of their beloved Bitcoin dropping below new support levels.
Currently trading at $28,800, it is down by just approximately 1% in the past 24 hours. Given the lack of movement recently, Bitcoin is now expected to end the week around the $29,000 zone. The volume is another concerning factor which is down by almost 25% since yesterday.
The largest cryptocurrency has gone through extreme volatility this month with the Terra de-pegging denting hopes of any recovery. Billions were wiped out from the crypto market after the crash putting Bitcoin on the brink of a major collapse.
Bitcoin survived but consolidated around the $29,000-$30,000 region. However, metrics suggest there is still more to come with recent discouraging data. In a recent Glassnode tweet, the NVT signal was recorded at its 4-year low of 233.9. The previous 4-year low was in fact, recently observed on 25 May piling on more pressure on the Bitcoin community.
Another tweet raised eyebrows across the crypto space, as Crypto Quant reported that there will be, “2-3 months of boring price action. Then last capitulation possible with 30%- 50% additional price drop”. This emphasizes on the market bottom being explored by the Bitcoin price chart as it struggles to rise back above the $30k level.
Analyst gives Bitcoin maxis hope
Marion Labore, analyst at Deutsche Bank Research, said in an interview with CNBC that,
“Bitcoin value will continue to rise based on what people believe it’s worth.”
Bitcoin is on a red chart far more often these days as it is looking to end a ninth successively in losses. It is also less than half its all-time high value of around $68k. But Labore stated four factors which will eventually help Bitcoin march to victory lands.
Labore gives out four factors that can lead to a price surge for Bitcoin. The first factor is the psychology behind bitcoin and cryptocurrencies which she refers to as the tinkerbell effect. This means the market sentiment towards Bitcoin will determine its growth in the future.
Around %55 of the $BTC supply is still in profit
“2-3 months of boring price action. Then last capitulation possible with %30-%50 additional price drop.”
— CryptoQuant.com (@cryptoquant_com) May 27, 2022
The second factor is demand and supply. With a fixed supply of 21 million coins, the demand for Bitcoin will eventually increase which will lead to a price surge. The third factor is the most controversial one: regulation. She also mentioned that she had reason to believe that “regulation is coming” which can pave the way for a greater crypto adoption.
Lastly, she points out volatility as a factor to determine Bitcoin’s growth. Crypto markets have been plagued by volatility in recent years with the Terra crash the latest example. But with regulations and increasing adoption, volatility can actually play into Bitcoin’s favor.