Bitcoin has fallen below $40,000 for the first time in nearly 50 days, a level previously boosted by ETF optimism and 2024 outlooks. This retreat has caused a ripple effect, leading to significant losses across altcoins. Ethereum struggles to maintain $2,200, while Solana briefly dipped below $80, and Binance Coin lost its crucial $300 support.
Analysts are adjusting their predictions following the recent price movements. Veteran trader Bob Loukas suggests Bitcoin’s weekly cycle chart indicates a peak has been reached. Peter Brandt confirms a bearish outlook, noting a completed expanding triangle pattern, and anticipates potential drops to $34,700, with Bitfinex setting a short-term target of $36,000. Pre-halving estimates even suggest a fall to $32,000.
Fidelity Investments’ Jurrien Timmer provides a more moderate perspective, attributing Bitcoin’s price direction to its network growth, scarcity (stock-flow), and real rates (Fed policy). He indicates that Bitcoin’s network is following a standard power regression curve, implying continued growth along an S-curve.
Investors are expected to maintain their current apprehension for another week due to macro pressures and GBTC sales until the upcoming Fed meeting. However, the March meeting, with a 50% chance of an interest rate cut, could reignite enthusiasm for risk markets, especially if supported by entries into spot BTC ETFs, potentially accelerating recovery.
Overall, the crypto market is witnessing a downturn, with analysts providing mixed forecasts. While some predict further declines, others remain cautiously optimistic, looking towards macroeconomic indicators and institutional support for cues on the market’s next move.