By Alicia Maher
BTC made some decent gains and traded above the $30K level on May 17, hoping to avoid 2017 highs.
Resting 2017 Peaks Is Highly Unlikely – Analyst
BTC price action on the 1-hour chart. Source: TradingView.
Data from the TradingView platform showed that BTC is making a temporary rally on the daily chart to close at building $30K. However, the leading digital asset doesn’t have a defined trajectory on the multi-day timeframes, even as volatility has continued since the start of this week.
While many analysts claim that BTC is only one massive retracement away from dipping lower than the 10-month low it experienced last week, a popular analyst (Credible Crypto on Twitter) gave an opposing view. According to Credible Crypto, BTC doesn’t have enough pressure to retest the $20K levels based on its historical performance.
He added, “it is not enough reason to assume that BTC will test the $13K/$14K levels because the bear market usually results in 80% decline from the top – the previous $65K was a cycle top.”
He also said, “people made a similar assumption when BTC hit $30K last June before it surged to a new peak price three months afterward.” As previously reported in various media, institutional investors are already making contingency plans should the need arise. For instance, the largest institutional holder of BTC, Microstrategy, has indicated that it would buy more BTC to prevent such steep falls in the value of the leading digital asset.
Credible crypto was coy when asked if BTC could dip to the $14K levels (its price as of March 2020 during the heat of COVID-19). In his response, credible crypto said, “I don’t expect that to happen even though it is possible. But as I previously said, it is almost impossible since BTC has never tested a previous high in its history.”
However, another top crypto analyst, Michael van de Poppe, opined that BTC’s performance would be greatly determined by the USD’s bullish run against other fiat currencies. Thus, giving digital assets a necessary relief. He predicted that the USD index (DXY) would still decline from its 20-year peak of 105 points.
DXY 1-day chart. Source: TradingView.
Van de Poppe further tweeted, “I predict that we will follow this scenario based on the current movement of the DXY. Liquidity has cut off the highs, and some corrective moves are more likely to occur now.”
If I look at the current state of the $DXY, I think we'll follow through with this scenario.
Assuming we'll be seeing some corrective move, the highs have been swept for liquidity.
Losing 103.7 points and I think we'll get more downwards pressure here -> risk-on assets up. pic.twitter.com/mRc5SW1nMk
— Michaël van de Poppe (@CryptoMichNL) May 16, 2022
Market Sentiment Firmly Skewed To The Downside
Nevertheless, based on the current market sentiment, many crypto players are leaning towards a further downtrend of the crypto market. On Monday, the crypto fear and greed index dipped to 8/100.
This index point is its lowest point since March 2020. Despite this new 2-year low of the crypto fear & greed index, BTC has been up 1.54% in the past 24 hours, according to the current Coinmarketcap data.