The Asia-Pacific Head of Trading at foreign exchange brokerage Oanda has predicted that bitcoin price will fall as low as $2,500, claiming the behavior of the asset over the past few months has not demonstrated to investors that a bottom is in.
Speaking on Bloomberg Markets: Asia, Stephen Innes stated that despite the pronouncements of “soothsayers”, the current situation remains a decidedly negative one for investors, who will consequently continue to sell or avoid buying bitcoin.
Responding to a question about how low bitcoin will fall before bottoming, Innes remarked that for a variety of reasons, cryptocurrency remains an unattractive buy in the near term. The key factor behind this according to him is the atmosphere of uncertainty about where the market is headed as bitcoin continues to its protracted bear run.
In his words:
“What I’m really looking at here is the way coins have been trading over the last few months. It’s indicated that the bottom is not in so therefore I don’t think any mature investor is willing to catch this falling knife. And that tells me there is more room to go and as soon as we hit some of these key round figure inflection points like $3500 and $2500, the psychological impact will weigh on more inexperienced traders.”
Going further, he remarked that while he remains optimistic on blockchain as a long-term concern, the current atmosphere of uncertainty makes cryptocurrency unappealing in the near term to both experienced and inexperienced traders, which will have a knock-on effect on the bitcoin price.
This he said, is amplified by the continued reluctance of Wall Street to get fully involved in cryptocurrency investment, a tightening regulatory landscape and the recent Bitcoin Cash hash war, which collectively add up to produce the current situation.
Summing up his thoughts on the current state of the market, he said:
“Given the momentum we’ve had over the past year, this price action is not positive, and despite what soothsayers say, it’s not a good time to go in because we can’t quantify what we’re really buying at these levels so this is the issue I have with trying to understand coins at specific inflection points.”
While bitcoin continues its slide, falling a further seven percent on Tuesday morning, not all market participants are pessimistic. CCN.com also reported on Tuesday that NASDAQ, the world’s second largest crypto exchange has announced plans to launch a bitcoin futures market in Q1 2019.
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Last modified: March 4, 2021 3:12 PM