Despite the rebound, there’s a lot of uncertainty as far as short-term Bitcoin price predictions are concerned
As AZCoin News reported, thanks to The B Word Conference with Tesla CEO Elon Musk’s appearance, Bitcoin price started a strong upward move from the $29,250 support zone, settle above $32,000. But, this may be a virtual pump as there are still many on-chain indicators that suggest the price will fall in the near term.
BTC/USD 4-hour chart | Source: TradingView
Bitcoin price extreme volatility is a constant reminder that the situation is still uncertainty
BTC hit a low of $29,300, and since then, the price has rallied back above $32,000. Despite the recovery, there is a lot of uncertainty in the crypto space regarding short-term price predictions.
In a recent Bloomberg interview, Scott Minerd, Guggenheim’s chief investment officer, reiterated his $15,000 Bitcoin price prediction.
“There’s still more air to come out of this.”
— Bloomberg TV (@BloombergTV) July 21, 2021
“Ultimately, I think that something in the neighborhood of $15,000 is where we are going to end up,” Minerd hasn’t been swayed by Bitcoin’s recent recovery.
He is convinced that there is still some more air to come out of the Bitcoin bubble. The CEO believes that uncertainty and competition with competing crypto projects could put additional pressure on Bitcoin.
After BTC dropped to $29,300, as AZCoin News reported, the Crypto Fear and Greed Index (CFGI) tapped a low of ten on the charts. The score of ten is not the lowest point the CFGI metric has recorded, but it is shallow compared to most days. The last time the CFGI metric recorded a ten was in mid-June and at the end of May. Since the end of May, the CFGI metric hasn’t been this low in over a year, as the last time the CFGI hit a ten or lower was during Black Thursday on the March 12, 2020 market rout.
Crypto Fear & Greed Index as of July 22 | Source: Alternative.me
While the extreme fear sentiment may seem dismal, traders believe it is one of the best entry points to get into any market.
According to Bloomberg chief commodity strategist Mike McGlone, Bitcoin’s current difficulties trying to fix above $30,000 after its recent dip below show that BTC is more mature for further upside. That is not a signal that Bitcoin is in for its dark days. McGlone has repeatedly asserted that Bitcoin is on track to hit $100,000 in the next few years in his previous tweets.
Probing $30,000 is rather necessary for the “supportive maturation” of Bitcoin that will later take it to a long-term uptrend. It is not right to consider it as a sign that Bitcoin’s dark days have arrived. Bitcoin has been trying to bounce back above $30,000 since then and has managed to do so, has now rallied to the $32,200 region.
Independent analyst and trader Keith Wareing was neutral about Musk’s movement. He argued that since no resistance levels had truly cracked, nothing had fundamentally changed in the short-term BTC price landscape.
“Elon pump (yay). Rejected bang on, literally bang fucking on the handle. But TA is a load of bullshit, so it means nothing, right? Wake me up when we break and close above $42300; otherwise, it’s still chopsville,” Wareing tweeted.
Source: Keith Wareing/Twitter
Before that, as AZCoin News reported, prominent Bitcoin critic, economist, and financial analyst Nouriel Roubini tweeted that he expects Bitcoin to continue to fall below $29,000. However, he also wondered if Bitcoin will be propped up by “pump and dump” schemes based on Tether’s USDT stablecoin, which is often used as a liquidity tool for buying and selling BTC.
Renowned economist, professor, and cryptographer Steve Hanke has expressed his attitude towards Bitcoin. He said, while many people see Bitcoin as “the currency of the future,” its excessive volatility should constantly remind them that it will never be a reliable unit of account. The extreme volatility of the largest cryptocurrency market is why it will never be considered a currency.
Many people believe #Bitcoin is the “currency of the future.” However, Bitcoin’s excessive volatility is a constant reminder that it can never be a reliable unit of account, & thus can NEVER be considered a currency. #BTC is just a highly speculative asset.pic.twitter.com/xV3kHM5IjK
— Steve Hanke (@steve_hanke) July 20, 2021
Moreover, the high transaction fees that users have to pay when converting Bitcoin to US dollars and vice versa are why Hanke thinks BTC will never be fully utilized in day-to-day transactions.
In fact, standard Bitcoin bear cycles have had 80% corrections. Uncertainty and competition with competing crypto projects could put additional pressure on Bitcoin.
After the brutal sell-off that took place earlier this week, the leading cryptocurrency has enjoyed an impressive recovery period. But don’t get too excited because if it’s just because of celebrity endorsements that prices go up, the opposite story can still happen.
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