A massive capitulation could be ahead for bitcoin (BTC) if some analysts are to be believed. But according to others, it’s just a matter of time before money printers are turned back on around the world and BTC rises in response.
Speaking in an interview with Barron’s earlier this week, Craig Erlam, Senior Market Analyst at Oanda, said that the lows that were seen in bitcoin around mid-June this year may not hold. The price lows are “really being put to the test as risk aversion sweeps through the markets once more,” Erlam said.
He added that any break of the lows from this summer could become “really damaging” for the bitcoin market. “Considering the outlook for risk appetite in the near term, it’s not looking good,” he said.
Others, including AvaTrade’s Chief Market Analyst Naeem Aslam, warned about a narrowing of bitcoin’s daily trading range, saying this means that more volatility is in the cards for the number one cryptocurrency.
“This is giving us an indication that a massive capitulation is coming,” Aslam said, adding that such a capitulation could occur at any time. “We believe that this capitulation can be any day now as bitcoin has been trading in a narrow range for a long period of time,” the AvaTrade analyst told Barron’s.
Asked how low bitcoin could potentially go in a “capitulation” scenario, Aslam offered a bleak outlook.
“The next move isn’t going to be about the [USD] 18,000 price level or [USD] 15,000 […],” he opined, while warning that a potential sell-off “could be so intense that it could easily push the prices towards the [USD] 12,000 price mark.”
Bitcoin community stays focused on the long-term
Although the two market analysts were both bearish on bitcoin’s near to mid-term outlook, members of the bitcoin community offered a more positive outlook for the longer-term.
Among them was Arthur Hayes, a popular crypto essayist and former CEO of crypto exchange BitMEX, who in an essay published on Wednesday highlighted Bitcoin’s role as censorship-resistant money in a time when Russia and the West is in what he called an “economic war.”
“The goal is to remain financially flexible in the face of the vagaries of war,” Hayes wrote in the lengthy essay, adding that “your opportunity to move your fiat assets into Bitcoin and other ‘real’ assets only exists today, and may not tomorrow. Remember that.”
Others, such as the popular bitcoin proponent and podcast host Mary Bent, opined that the most likely outcome of the current energy crisis in Europe is that the US Federal Reserve (Fed) turns its dollar printer back on.
“The energy crisis is going to turn the money printers back on faster than most expect,” the popular bitcoiner wrote.
As is well-known in investment circles by now, bitcoin tends to respond positively to increased money printing in the US, which means that a turn-around from the Fed is likely to boost the bitcoin price going forward.
At the time of writing (10:10 UTC), BTC was down by 5.7% for the past 24 hours, trading at a price of USD 18,797.
Source: Cryptonews
