Bitcoin prices are in retreat again during Asian trading on Monday morning and analysts are predicting more pain ahead as the correction deepens.
Bitcoin has fallen back to more than 15% down from its mid-March peak, dropping to a ten-day low of under $62,000 on Monday morning.
On April 28, an analyst feed ‘Stockmoney Lizards’ noted that the halving was over, but bitcoin continues to print red candles.
They said that we are not at the end of the bull market but added a gloomy prediction that what we see is a correction that could send prices back to the $50Ks before continuing:
“Call it triple top, call it Wyckoff distribution. Bitcoin is in correction mode,”
Bitcoin
Halving is done and yet, Bitcoin continues printing red candles. Is this it for this cycle?
A lot of folks are insecure, especially in light of the geopolitical and macroeconomic situation
Let’s take a look at some charts and indicators.
A 🧵 pic.twitter.com/bQ2nDITrAq
— Stockmoney Lizards (@StockmoneyL) April 27, 2024
More Pain Before Gain
In essence, a correction is necessary after half a year of solid gains. War, recession fears, inflation, and reduced ETF buying are all adding to market sentiment.
The analysts noted several layers of support at $60K, $56K, and $52K, each one becoming more likely if the one above it is broken.
The short-term outlook for May, which is historically a neutral month, is a potential uptrend within the correction range. “Even a breakout seems possible if market conditions remain stable,” they said before adding that “‘Bad news, of course, would push us towards the $50Ks.”
This week the Federal Reserve will make its interest rate decision and rates are likely to remain where they are given the higher than expected inflation outlook. This could accelerate the market correction and drop BTC below its immediate support level of $60K.
Trader ‘CrypNuevo’ advised caution for the coming week, saying that they’re not going into it with any open positions. “Weakening economy with rising inflation? The worst outcome for the FED,” they added.
On The Positive Side
While the overall short-term sentiment is gloomy, things are not all that bad according to Glassnode analyst “Checkmatey.”
He observed that bitcoin retail holders, “who are apparently degenerates who will sell on the first sign of a correction,” appear to be stacking sats once again.
“Shrimp” accounts with less than 1 BTC are accumulating 12,200 coins per month, according to Glassnode data.
Corrections are healthy parts of market cycles and will always produce opportunities to buy the dip. How deep and how long this current correction will last remains to be seen, however.