- Bitcoin is trading at $42,100 at press time, but analysts say that the cryptocurrency could dip to $30,000 before bouncing back to new highs.
- One analyst sees NFTs and DeFi as the two sectors that will see the most growth as another recommended two altcoins to beat the market when BTC dips.
Bitcoin is trading above $42,000 at press time, but it could be looking at a dip that will take it to $30,000 in the near future, analysts have claimed. Despite the correction, they believe that in the medium term, BTC will bounce back and retest its $69,000 highs. However, in the meantime, they recommended two altcoins they believe will beat the market.
At press time, BTC is exchanging hands at $42,115, gaining 1.5 percent in the past day, but is still down 4 percent in the past week.
(Chart showing BTC’s price action and relative strength index, courtesy of Trading View).
The cryptocurrency has been range-bound for a while and has been consolidating between $40,000 and $44,500 for the past two weeks. But according to some analysts, this may be the calm before the storm.
Bitcoin to dip to $30,000
Bitcoin has become interlinked with the stock market increasingly as more institutional investors and products have cropped up. As CNF reported, Arcane Research found that the 90-day correlation between BTC and the S&P 500 is at a four-month high.
This correlation makes Bitcoin prone to overall market shocks. Speaking to Business Insider, LMAX Group’s Joel Kruger stated:
We are in a market environment where cryptocurrencies are very much tied to what’s going on with the fundamentals in the traditional financial market space. And that’s kind of what’s dominating price action right now.
The technical analysis doesn’t paint a good picture for BTC in the short term. Armando Aguillar, a crypto analyst formerly at Fundstrat told the outlet that the relative strength index (RSI) of BTC is approaching oversold and it looks set to test $30,000.
If we are not able to keep that momentum on RSI and MACD basis, we could see newer lows. I would not be surprised to see all these indicators coming into play and prompting another major sell-off where we could see bitcoin potentially hitting mid- to even low- $30,000.
The dip will only be temporary, however, he says.
He commented, “We should see these markets exceptionally well-supported for the next major breaks to the top side through $100,000 and towards $10,000 respectively when talking about the price of bitcoin and ether. I think it’s very possible that we would see a move by the end of the year.”
Meanwhile, investors can look at altcoins that are likely to beat the market in the near term. Aguillar has picked Near Protocol (NEAR) and Fantom (FTM) as the two altcoins he believes have the best odds in the short term.
Last year, NEAR shot up from $2.2 at the start of the year to hit a high of $20.20 a week ago, an 818 percent rise. FTM, on the other hand, shot up from $0.026 to $3.274, a 12,592 rise in a year.