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As Bitcoin continues with its dovish performance, it could be bottoming out around $40K levels. Despite this laggard performance, some market analysts remain hopeful that Bitcoin could reach $100K levels soon.
Aggressive sell-offs in the cryptocurrency space have led to a major correction in the crypto market. Earlier today, the Bitcoin (BTC) price tanked under $42,000 to the levels last seen in September 2021. As of press time, Bitcoin is trading at $42,219 with its market cap falling under $800 billion.
With the recent correction, Bitcoin is down by more than 40% from its all-time high levels of $69,000 in November 2021. The recent sell-off in the equity and crypto market comes following the Fed commentary earlier this week. The US central bank has hinted at tightening up the monetary policy sooner than expected.
This sentiment has hurt equities and crypto alike as investors see them as risk-off assets. Brent Donnelly, president at Spectra Markets said that the macro story for crypto is getting worse over the past few months.
“Markets tend to view QT as the most risk-negative brand of tightening policy from the Fed because it’s the inverse of the aggressive monetary easing that triggers a Pavlovian “BUY EVERYTHING” reaction each time the Fed eases,” he said.
The recent correction is not only for Bitcoin but across the broader crypto market. Altcoins have entered even deeper correction with consistent double-digit percentage losses in the last two days. Bloomberg’s Mike McGlone, however, notes that Bitcoin could benefit from Fed’s tightening monetary policy. the Bloomberg analyst expects Bitcoin to still touch $100K levels.
“Expectations for Federal Reserve rate hikes in 2022 may support a win-win scenario for Bitcoin vs. the stock market. Stretched markets have become common, but commodities and Bitcoin appear to be early reversion leaders. It’s a question of bull-market duration, and we see the benchmark crypto coming out ahead,” said McGlone.
$100K Bitcoin (BTC) Price Targets Still Here
While the Bitcoin price correction gets steeper, analysts see it as an inherent part of the BTC price volatility. Thus, some market analysts continue to hold bullish predictions for the BTC price going ahead into 2020.
Recently, Wall Street banking giant Goldman Sachs said that Bitcoin could hit $100K. However, Goldman’s predictions have been stretched over a five-year period anticipating a consistent 17-18% CAGR returns till 2025.
On the other hand, there are analysts who expect Bitcoin to hit $100K levels this year itself. Ryan Selkis, co-founder at Messaari Inc says Bitcoin can touch $100K by May 2022.
While many have been talking about the higher Bitcoin price targets, where’s the bottom? Galaxy Digital founder Mike Novogratz recently said that Bitcoin could be bottoming somewhere at $38,000. He also said that institutional investors are preparing to buy BTC at those levels. Speaking to CNBC’s Squawk Box, Novogratz said:
“I know big institutions who are going through their process to put positions on and so I think they’re gonna see those as attractive levels to buy. On the charts, $38 [thousand], $40 [thousand] feels like where we should bottom.”
Read other Bitcoin news on Coinspeaker.