I do think that eventually we see that type of move, because quite frankly there’s no reason to believe that suddenly things are going to change.
The 50-Day EMA sits right around the $19,265 level and is dropping. Ultimately, I think this is a market that sooner or later will see a resistance based upon technical analysis and a simple lack of momentum. Ultimately, Bitcoin has very little in the way of interest right now, as risk appetite has been destroyed. If risk appetite is very weak, it’s difficult to imagine a scenario where a lot of institutional money is going to go flowing in the cryptocurrency. Furthermore, we are during a “crypto winter”, and in other words very few people are paying close attention.
If we were to break down below the $18,000 level, I could open a move lower, but right now I think we are more likely than not going to continue to see that offer a short-term floor. If we break down below there, then it’s possible that we could go down to the $15,000 level, possibly even down to the $12,000 level. I do think that eventually we see that type of move, because quite frankly there’s no reason to believe that suddenly things are going to change. I like the idea of fading rallies, perhaps through the CFD markets because then you don’t have to worry about custody.
For a longer-term “buy-and-hold market”, you need the Federal Reserve to do something other than tighten monetary policy. They do not look very likely to do that anytime soon, so with that, I believe you got a situation where it’s a bit of a one-way trade. I believe that all crypto right now is a bit toxic, as we are during the “everything bubble” being popped across the world.