Saying the first half of 2022 was tough for crypto hodlers is an understatement. It was a nightmare. The silver lining is that all assets are falling. Investors escape from crypto, stocks, commodities, gold, and all currencies other than the US dollar. Even the euro is approaching parity with the USD after decades of nominal dominance.
Apparently, BTCUSD is stuck in a horizontal drift since mid-June. I can see a clear balance between the crypto FUD from bears and FOMO from bulls. The first want to sell, but don’t want to do it too early. The second would love to see a pump, but during the global financial panic, they could blow up in their faces as many crypto whales would love to dump their big bag on somebody before it’s too late.
On a longer scale most of the time this situation ended following major price action, so I expect that the selling will continue, and the next support may be as low as $18,000. Here’s why.
At the moment our BTC bus has just passed the $20,000 stop. That’s far from the drops on BTC we saw before. The four biggest falls made BTCUSD lose around 87% of its value. What’s more, looking at the last ATH in November 2021, we are still on the downtrend. And I think still quite far from the bottom.
Let’s take a short look at the math behind the markets. We may expect BTCUSD for as low as 9000$ in a long term. At the moment I think that a fall to 18,000$ fall around July 13 when the Fed meets to present its inflation data.
During a normal crypto cycle, you would expect high inflation data to trigger an uptrend in crypto, but we are far away from ordinary.
The problem is that FED will make another decision to raise interest rates. This move will give investors another reason to escape from everything to USD. Cash is king in the short term, and Bitcoin promises to be an alternative to cash.
And so far this kind of movement ended in falls on BTC. Sadly it didn’t fight inflation as was expected from it so far. Also by us here at SFX team.
July 13 is also the 30th day of horizontal movement, which often ends in falls.
So my guess, for now, is to short BTCUSD and sell before FED goes public with its plans. I guess I’ll go in around $18,000 as it will probably rise again close to $19,000 in the next few days.
This is my short-term strategy. But I might be wrong, so remember to act according to your own judgment, especially if you want to invest substantial money.
The content of this post is not investment advice and does not constitute an offer or solicitation to offer or recommendation of any investment product.