Stockbroker, financial commentator, and gold proponent Peter Schiff’s disdain for bitcoin is well known. The gold bug hasn’t held back in his criticism of the flagship cryptocurrency, calling it a “Ponzi Scheme” earlier this year. He now seems to be taking sadistic pleasure as the price of bitcoin is crashing, and he is rubbing it into crypto bulls with a gloomy price forecast.
#Bitcoin has finally broken below the support line of the large descending triangle it has been carving out for months. This is a very a bearish technical pattern, and it confirms that a major top has been established. The risk is high for a rapid decent down to $4,000 or lower!
— Peter Schiff (@PeterSchiff) September 24, 2019
Peter Schiff suggests that the bitcoin price rally is over
According to Peter Schiff’s tweet, he believes that the price of bitcoin has hit a “major top.” With the establishment of a bearish technical pattern that saw the bitcoin price fall below the support line of the descending triangle, Schiff estimates that there is a lot of downside risk in the cards.
In fact, the bitcoin bear forecasts that the price of crypto asset could head to $4,000 or lower, implying a downside of more than 50 percent from current levels.
Schiff’s bashing is not at all surprising as he seems hell-bent on seeing the cryptocurrency fail. He has earlier pointed out that bitcoin does not have any intrinsic value, and it will never hit optimistic price forecasts of $50,000.
Should you believe this bear view?
Bitcoin’s latest crash was predictable. The market-leading cryptocurrency was indeed making a bearish technical pattern, and analysts had predicted that its next level of support in case of a crash would arrive at $8,500.
The price hit those levels yesterday, but it has fallen further as of this writing to just over $8,300. The fall of bitcoin’s price below the key support level of $8,500 can be attributed to the muted launch of the Bakkt futures trading platform earlier this week. This dealt BTC a psychological blow as Bakkt’s launch was supposed to boost institutional adoption of the cryptocurrency.
But it is still early days and the situation seems to be changing already. Data from Bitwise suggests that spot bitcoin trading volumes in the past 24 hours have exceeded $3 billion, a substantial jump over the $500 million daily trading volumes that were recorded toward the beginning of September.
So if institutional demand comes back into play, the knee-jerk reaction that has led to bitcoin’s latest crash should subside and the price can recover once again. This is why bitcoin bulls should not be discouraged by Schiff’s view that the cryptocurrency is heading to $4,000, as the possibility of a turnaround still remains.
Click here for a real-time bitcoin price chart.