The October 10 crash triggered the worst liquidation event in the history of cryptocurrencies, and caused Bitcoin prices to take a huge hit. An initial downtrend wave took it towards $102,000 before a recovery, but subsequent waves ultimately pushed the price below $100,000 for the first time in more than four months. But as cryptocurrencies appear to be regaining a foothold in the market, there are growing questions about whether it’s time to buy or whether to wait for further declines, answered by crypto analyst Mark P. Markets.
Why BTC is good to buy
To answer the question of whether it’s a good time to buy BTC despite Bitcoin prices plummeting in recent weeks, MarcPMarkets believes there is upside potential for buying BTC at around $100,000. The cryptocurrency analyst explains that although the majority remains bearish due to the decline, it does not take away the fact that Bitcoin still presents a good buying opportunity as it sits in territory where a bullish reversal is possible.
One of the main factors that favors the purchase of BTC is the fact that the current macro environment remains highly inflationary. Because Bitcoin’s supply is capped, it is seen by some as the “perfect” edge against endless government money printing. Therefore, as more fiat currencies flood the market, we expect Bitcoin prices to rise accordingly, making holding BTC even more valuable.
The cryptocurrency analyst also explained that the US government shutdown has created what is known as the digital divide. Due to the closure, valuable information is not available to the public and these missing reports can have a significant impact on prices.
Additionally, the US Federal Reserve has shifted to a more dovish stance, which is positive for risk assets such as Bitcoin. Interest rates are falling and are increasingly expected to fall further, to between 3.50% and 3.75%, according to the FedWatch tool. The Fed is also expected to end quantitative tightening and move into quantitative easing in early December, creating an enabling environment for a recovery in Bitcoin prices.
Bitcoin price needs to hold support
Bitcoin price is not yet fully out of the crisis and will need to maintain significant support to recover. MarcPMarkets notes that there is still support at $98,000, but if the cryptocurrency fails to sustain this level, Bitcoin price will face the next support at $95,000.
However, the main concern level is around $80,000, and a fall to this level could signal the beginning of the next bear market. First, analysts explain that $88,000 overlaps with the first wave, and if it cannot bounce back quickly from here, it means Bitcoin price is in a broader correction wave.
“I think the broader bullish structure (wave 4) is still intact until the price overlaps the first wave at 88,000,” the analyst said. “If we fail to test this level during this bearish attempt, it means a broader 5th wave is likely to follow, which could theoretically test the 126K high.”
Featured image from Dall.E, chart from Tradingview.com
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