Swissblock forecasts Bitcoin’s downtrend to US$58k, anticipates cryptocurrency market cool-off
The biggest cryptocurrency, Bitcoin (BTC), has been rising steadily over the last month, setting new records along the way as every decline was swiftly snapped up, but experts cautioned that the market might be ready for a cooling-off period.
In a letter published on Wednesday, the digital asset analytics company Swissblock stated that there may soon be a cooling spell as bitcoin’s price roughly doubled from US$38,000 in late January to US$35,000 today.
“Nothing exhibits a linear rally. Not even Bitcoin,” experts at Swissblock stated in a Telegram post. “A counter move seems to be near.”Based on the negative bearish divergence between the 4-hour chart’s declining relative strength index (RSI) and bitcoin’s price sluggishly increasing, Swissblock experts projected lower prices. A popular momentum indicator that gauges the magnitude and speed of price fluctuations in an asset is the RSI.
The Swissblock analyst Henrik Zeberg’s graphic indicates that a downturn might occur soon in the next few days. Lower prices, however, are just going to be a brief setback before the rise finally continues to new highs. “We anticipate a 20% drop in Bitcoin prices to US$58,000–US$59,000 in the upcoming move,” they stated. “But the top is not in.”
The cryptocurrency investment services company Matrixport also predicted a period of stabilization on Tuesday and said that the bitcoin rise is running out of gas. “This bull market still has legs, but the divergence between a declining RSI and still high bitcoin prices could signal that BTC needs to consolidate before rallying again,” experts at Matrixport stated.
Rising meme coin values may also be a harbinger of a coming downturn because the last phase of a cryptocurrency rise sometimes involves shifting earnings from large-cap stocks to riskier tokens. In May of last year, for instance, the explosive rise of Pepe coin (PEPE) predicted a 15% drop in the price of bitcoin the following month.
After rising 2.6% on the last day, Bitcoin was just traded for a little over US$73,000. During the same time frame, the Coindesk 20 Index (CD20), which measures market performance broadly, increased by 4%.
