- Arthur Hayes is predicting a slow upward trend for Bitcoin after hitting a local bottom
- Bitcoin’s value will stabilize between $60,000 and $70,000 until August, he added
The last few weeks have been difficult for the crypto-market, with the same marked by a sharp decline in Bitcoin’s value. From a peak of $73,000 in March, Bitcoin has tumbled by over 19%, with a notable 7.8% drop in the past week alone. This steep decline has left investors and market watchers searching for signs of stability and potential recovery paths.
Exec weighs In: A turnaround on the horizon?
However, Arthur Hayes, the former Chief Executive of BitMEX, has shared a glimmer of hope amidst the market’s volatility. In his latest blog post, the exec suggested that Bitcoin has hit a local bottom, while also predicting gradual upward movement in the coming months.
This perspective offers a contrast to the prevailing market sentiment, which has been largely bearish due to various economic pressures. These include Federal Reserve policy uncertainties and a general slowdown in cryptocurrency investments.
Hayes believes that the recent 12% retreat in Bitcoin’s price was necessary for market correction, attributing it to the U.S. tax season, which often prompts investors to liquidate holdings for tax liabilities. Additionally, he pointed to the “sell the news” effect that has been around since Bitcoin’s latest halving and a deceleration in the growth of assets under management in spot Bitcoin ETFs.
Market mechanics: Liquidity and future projections
One of the more intriguing aspects of Hayes’s analysis is his discussion on the implications of the Federal Reserve’s quantitative tightening (QT) strategy. He believes that the tapering of QT could lead to increased liquidity in the financial markets, potentially benefiting riskier assets like cryptocurrencies.
In fact, he described this process as a form of “stealth money printing” that could bolster asset prices, leading to a sustained recovery phase.
Moreover, Hayes is optimistic about the market’s capacity to absorb these changes and start a slow ascent. He envisages a scenario where the market will stabilize and then commence a gradual climb, mitigating the more drastic price movements seen recently. A far as his price prediction is concerned, Hayes noted,
“A rally to above $60,000 and then range-bound price action between $60,000 and $70,000 until August.”
Here, it’s worth noting that over the last 24 hours, Bitcoin has shown signs of a supposed “slow climb” on the charts. While it hiked to a 24-hour high of $59,966, BTC also recorded a trading volume that exceeded $30 billion, according to data from CoinGecko.
Melker believes otherwise
Despite these positive projections, however, some analysts are more cautious. According to Scott Melker, for instance, because Bitcoin has broken past crucial support levels, now serving as resistance, this might trigger further price drops. In fact, he believes that a potential freefall to about $52,000 wouldn’t be out of the question.
Melker further claimed that the recent decline is relatively minor, marking only a 23% drop and well in line with previous corrections observed during this cycle. A more significant correction of 30% to 40% is likely during this market phase, he added.
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