Will we ever see Bitcoin at $70,000? Yes, but $12,000 first!
Well, the crypto winter is here. Bitcoin fell to $21,000 and is about to go lower, but how low can it drop? BTCNEXT analysts have some clues!
1–14 June main events
- The Ropsten testnet switches to Proof-of-Stake. Ethereum developers have successfully transitioned the Ropsten testnet from the Proof-of-Work (PoW) algorithm to the Proof-of-Stake (PoS) consensus algorithm. Following Ropsten, test networks Goerli and Sepoila will be transferred to PoS. This will take several weeks.
- Reuters announces that criminals laundered $2.4 billion through Binance. According to Reuters, from 2017 to 2021, cybercriminals laundered at least $2.35 billion through the Binance cryptocurrency exchange, obtained from hacks, investment fraud and drug sales, due to weak AML procedures.
- SEC investigation into BNB token. Bloomberg reported that the US Securities and Exchange Commission (SEC) is investigating whether Binance’s BNB token was a security at the time of its sale in 2017.
Abundant FUD and the weak S&P 500 brought down Bitcoin quotes to $21,000. Despite the total oversold on all key indicators and the expectation of a rebound to the $36,000-$38,000 zone, strong support at $27,000-$29,000 could not withstand the pressure from sellers. BTC plummeted like a lead balloon, dragging the entire crypto market down with it. The cascade of liquidations exceeded $2 billion. For the first time in a long time, the crypto market capitalization fell below $1 trillion. It is too early to talk about a trend reversal.
The high correlation with the stock market (0.5) will continue to put pressure on cryptocurrencies. The Dollar index has updated to another historical high of 104 points. The nearest important support level for the S&P 500 is at $3,400, which leaves room for a 10% correction on the current levels ($3,750). The combination of these factors will be enough for the price of Bitcoin to fall below $20,000. A squeeze to $18,000 is possible. If there is no active reaction at these levels, the price will continue to decline towards the $12,000-$14,000 zone. These are the maximum correction targets for BTC.
Altcoins are falling at double the speed and this trend will only get worse. The best solution now would be to buy BTC and ETH for the long term or hold capital in stablecoins. The crypto winter is officially here.
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