There is good news and bad news surrounding bitcoin. The good news is that its next major rally is believed to be about six months away according to analyst Katie Stockton. The bad news is that the world’s number one digital currency by market cap is likely to endure a few more hectic drops before this rally occurs. In fact, she is confident that at one point, bitcoin will fall below the $14K mark.
Katie Stockton on the Fate of Bitcoin
We are now in the early stages of 2023, and many traders are wondering if this year will present the healing and rallying that they expected but didn’t get in the final months of 2022. The latter year was arguably the worst on record for both bitcoin and crypto in general. BTC fell by more than 70 percent from its all-time high of about $68,000 per unit, which was achieved in November of 2021.
Exactly one year after that, the currency was trapped in the mid-$16,000 range, thus bringing everyone’s hopes that the world’s primary form of crypto was somehow a hedge designed to fight inflation. The Fed invoked several rate hikes as a means of fighting inflation, and bitcoin – each time without fail – sunk even further into oblivion whenever a new push occurred.
At the time of writing, bitcoin is in the high $16,000 range. It was believed that the currency would remain in the high $17,000 range during the final days of 2022, but this has been a struggle for the asset, and Stockton believes things could get worse before they get better. In a recent interview, she stated:
Short-term momentum has shifted negative, which supports a bearish near-term bias. We expect a retest of the November lows, near $15,600, in the coming weeks.
From there, she believes the currency could fall even more. She predicts a price of $13,900 during the second half of 2023, which would mean that bitcoin would have to fall another 18 percent from where it is now. She said:
With long-term momentum still strongly negative, we ultimately expect bitcoin to make a lower low, increasing risk to long-term support near $13,900, which is defined by the 2019 peak.
To reach her present numbers, Stockton says she’s focusing primarily on price trends rather than the fundamentals of bitcoin. She commented:
For indications of a major low, we like to consult the De Mark Indicators, which are at least seven months away from logging a counter-trend signal on the monthly chart.
There’s Still a Fighting Chance
Despite all the gloom and doom, Stockton assures that there’s always a chance bitcoin will defy her negative expectations.
If this happens, she’ll be keeping her eye on various resistance levels to see whether a rally has true strength behind it or if it’s a fluke.
Source: Read Full Article