Terra’s recent collapse has been repeatedly cited as the main source of vulnerability affecting cryptocurrencies, but it is much more likely that a combination of factors is behind the beginnings of this current bear market.
At the same time as the market was picking up on the Terra story, the 2-year target for the next half of Bitcoin (BTC) was also exceeded and this is a measure that some experts have used as an indication of the end of the bull market.
As shown in the chart above, previous cycles have seen BTC reach a peak followed by a price drop that first drops below the 50-day moving average (MA) and then a maximum capitulation event that pushes the price down below the 200-day MA.
Many traders were put off by the lack of a peak that was blown off in the latest bull market round because this phenomenon has usually marked a late stage of waste development.
Traders also questioned the legitimacy of the popular stock-to-flow model after BTC failed to reach $ 100,000 by the end of 2021.
In previous market fluctuations, BTC was well above the S2F model at this stage in its progress with the model variant in positive. Currently, the deviation of the model gives a reading of -0.86 while the price of BTC is well below the S2F line.
This lack of emissions has led some traders to stick to previous calls about a single price hike that will see BTC reach $ 100,000 before entering the widespread bear market, but that remains to be seen.
Looking forward to being bearish after this wave of over 100k that I expect to end. Seeing how it feels now during a mid-cycle correction means that the correction that corrects the entire cycle of the bull from 3k to 100k + will be absolutely cruel. $ BTC
– CrediBULL Crypto (05.27) (@CredibleCrypto) May 17, 2022
Maybe the market will bottom out in November?
While some are still hoping for one last hurray before the bear market really starts, a more pessimistic view is to predict another 6-month price drop before the market bottoms out.
Compared to previous rounds, the market minimum reached approx. 13 months after the market peak, which would point to a bottom sometime around December this year if current trends continue.
This is further confirmed when looking at the time between the market bottom and the next Bitcoin halving event.
In previous rounds, each ring was struck low approx. 17 to 18 months before the next half. The next halving of the BTC is forecast to take place on 5 May 2024, which would indicate that the market will bottom out in November or December 2022.
Connected: Bitcoin is a discount close to the “redeemed” price, but experts say there is room for deep flaws
Merchants are still permabulls despite current pricing measures
In terms of price forecasts, there is much less consensus on this issue due to BTC’s underperformance in the last round where most traders expected $ 100,000.
Traders continue to call for BTC to cross the $ 100,000 mark in the not too distant future and a handful stick to the penultimate $ 1 million mark.
The general range of potential prices described by LookIntoBitcoins’ price forecast indicates a BTC maximum of $ 238,298, while the delta top indicator indicates a high of $ 119,886. The terminal’s price index now gives a price forecast of $ 107,801.
The views and opinions expressed herein are those of the authors only and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading business involves risk, you should conduct your own research when making a decision.
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