Bitcoin (BTC), the largest cryptocurrency, recently saw a surge past the $52,000 mark. This has led to a bullish outlook and increased optimism about Bitcoin's rise to $100,000. On the other hand, analysts have even given a long-term target of $150,000, although before then the Bitcoin price is expected to undergo a correction of up to 40%.
Analysts expect Bitcoin price to correct by 40%
Renowned cryptocurrency analyst Michaël van de Poppe has made bold predictions about the direction of the Bitcoin price, predicting a rise to $150,000, which would be preceded by a massive decline. In a recent analysis, Poppe highlighted the possibility of a 40 percent correction in BTC price before it resumes its uptrend.
According to Poppe, market sentiment often goes beyond reality, resulting in exaggerated price movements. He explained: “Sentiment is always a false indicator. Emotions always trump reality and sentiment far outstrips price action, which is why people start losing money.” This sentiment-driven volatility has been evident in recent market moves, including Bitcoin’s rise to $50,000 and subsequent corrections .
Additionally, Poppe warned traders and investors to adopt a strategic game plan based on their risk tolerance and investment horizon. For short-term traders, he advised caution, especially if prices have risen quickly. “If your horizon is relatively short, it may not be +EV to buy an asset that has increased in value by 35% in 10 days,” he noted. Furthermore, he emphasized the importance of assessing the risk-reward ratio before making trading decisions.
The decline is expected to occur after Bitcoin price peaks between $53,000 and $58,000. In contrast, Poppe suggested that long-term investors could benefit from waiting for a standard 20% to 40% correction before entering the market. “If your horizon is two to three years out and you suspect that Bitcoin will be over $150,000 in that time frame, then it’s not a big problem to start scaling at those prices,” he noted. This approach will allow investors to profit from market declines and manage emotions effectively.
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Influence of macroeconomic factors on Bitcoin
Poppe also discussed the impact of macroeconomic events on Bitcoin price movements, citing factors such as Consumer Price Index (CPI) data. He warned that negative macroeconomic developments could trigger a rapid downward move in the price of Bitcoin. “Frankly, I think the moment macroeconomic events are slightly negative would indicate that we are going to see a correction,” he said.
Additionally, the hot January Producer Price Index (PPI) data created extreme volatility in the market, further amplifying the impact of the January CPI report. Despite the potential for short-term volatility, Van de Poppe expressed confidence in Bitcoin's long-term prospects, predicting a rise to $150,000. While other analysts gave an optimistic outlook for Bitcoin price, they gave a target of $100,000.
At press time, BTC price fell by 0.86% to $51,516.41 on Sunday, February 18. BTC price had a market cap of $1.01 trillion. At the same time, the 24-hour trading volume fell by 12.65% to $21.72 billion. The recent downtrend in Bitcoin price could be due to the negative PPI report released on Friday.
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