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Pardon the pun, but I'm going to “coin” a. Bitcoin (BTC USD) sentence right now. Since the “Buy the Rumor” and “Sell the News” phases are already over, it’s time for what I would call “Buy the Hangover.” In other words, my BTC-USD stock forecast calls for significantly higher prices as the market fears Bitcoin again.
Of course, the “buy the rumors” phase came when traders suggested that the Securities and Exchange Commission (SEC) was preparing to approve one or more spot Bitcoin exchange-traded funds (ETFs). We are now past that phase, but we are also past the “selling the news” phase of Bitcoin. What comes next is a great opportunity as long as you can handle the volatility that comes with it.
Spot Bitcoin ETFs are here. What now?
It's funny how the preparation for an expected event is usually more exciting than the event itself. This was certainly the case with the expected SEC approval of spot Bitcoin ETFs. As excitement grew, Bitcoin rose to around $48,000.
Lately, financial giants like BlackRock (NYSE:BLACK) And loyalty have entered the spot Bitcoin ETF fray. These companies’ spot Bitcoin ETFs have already accumulated billions of dollars in assets under management (AUM).
All of this should bolster the sense of legitimacy surrounding Bitcoin among traditional financial firms. In other words: Bitcoin has “arrived” in 2024.
Still, Bitcoin has fallen to less than $43,000 following the SEC’s approval of spot Bitcoin ETFs. This is the “selling the news” phase, but I argue that this is not the final phase of this sequence. Next, there is a sense of fear and doubt, and this is exactly what controversial investors should pay attention to.
Reasons to worry about Bitcoin – and reasons not to
If you're looking for reasons to be worried about Bitcoin, you can find them if you dig deep enough. You could refer to this for example New York Community Bancorp's (NYSE:NYCB) horrendous financial results and share price decline. Then the prospect of a contagion of regional bank failures in 2024 could rob you of sleep.
Or you can stay calm and remember that the regional bank bankruptcies were quickly contained in March and April 2023. Therefore, the events surrounding New York Community Bancorp are unlikely to pose a problem for Bitcoin.
Plus, you might be wringing your hands because Federal Reserve Chairman Jerome Powell has suggested that a rate cut is unlikely at the March meeting. This could impact Bitcoin price if there is a slowdown in the US economy.
Of course, you may panic sell your Bitcoin for these reasons. Alternatively, you can look back at history and see that every single fear-related decline in the price of Bitcoin has been a great long-term buying opportunity.
Instead of finding excuses to worry about Bitcoin, you can add to your position when the price drops. The point is that if you want to buy and hold Bitcoin, you need to make volatility your friend.
Here's how to stay calm and stay on top of things like Usman Ahmad, CEO of Zodia Markets, did. Usman assured: “In the medium to longer term, we will see stabilization and long-term positive tailwinds for Bitcoin price performance and volume activity going forward.”
BTC-USD stock forecast: After the hangover comes the rally
If we are in the hangover phase of Bitcoin, you can join the worries or embrace the volatility. My BTC-USD stock forecast undoubtedly suggests that the price will fluctuate, but fear-related Bitcoin declines are only temporary.
Most importantly, understand that the “Buy the Hangover” phase is exactly the right time to get into Bitcoin. When bears look everywhere for excuses to sell Bitcoin, it is nothing more than a bright green buy signal.
David Moadel has provided compelling content—and occasionally pushed boundaries—on behalf of Motley Fool, Crush the Street, Market Realist, TalkMarkets, TipRanks, Benzinga, and (of course) InvestorPlace.com. He also serves as chief analyst and market researcher for Portfolio Wealth Global and hosts the popular financial YouTube channel Looking at the Markets.
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