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04.08.202108:01 Forex Analysis & Reviews: As soon as bitcoin rose to $40,000, "optimistic forecasters" immediately became active

Exchange Rates 04.08.2021 analysis

Bitcoin has started to fall and will now strive for the level of $29,700. Despite the fact that the cryptocurrency retains chances of returning to the local maximum near the level of $42,300, we believe that it cannot avoid a fall to $29,700 in any case. Moreover, bitcoin is currently in an expanding side channel, that is, its current target is located even slightly below the level of $29,700. However, the main thing is something else: the bullish trend has not resumed, and bitcoin remains in the process of consolidation, as we have said in the last few months. Thus, the main transactions for "digital gold" should be sales.

As for the fundamental background, it continues to remain sharply negative for the first cryptocurrency in the world. We have already listed all the negative things that have been coming from China and the United States recently several times. It doesn't make sense to repeat it again. But crypto traders could observe a very interesting phenomenon in the last few days. As soon as bitcoin rose in price to $40,000, a whole mass of various crypto forecasters immediately became active, who again began to predict that bitcoin will cost in a few years. The list of crazy forecasts was opened, of course, by MicroStrategy CEO Michael Saylor. In his opinion, bitcoin will be on the balance sheets of cities, states, and every person in a few years. In his opinion, everyone will own bitcoin. However, for what purposes every person on Earth will own bitcoin, Saylor did not say. A similar opinion was expressed by the founder of Pantera Capital, Dan Morehead. He said in an interview that bitcoin now looks undervalued, and in the next 10 years, the cryptocurrency will rise in price to $700 thousand per coin. In 10 years, Morehead believes, every smartphone owner will use bitcoin. But a fairly well-known cryptocurrency expert Willy Woo believes that bitcoin has not reached its heights even in 2021. As part of his podcast, he noticed that bitcoin had not previously completed a bullish trend, without working out the upper limit. And at the moment, the upper limit is at the level of $162,000, where bitcoin can strive for in the next 5 months.

As for us, we continue to believe that the bullish trend is over, and all attempts by investors to return bitcoin to growth are doomed to failure. We still adhere to the correction scenario, according to which bitcoin will first fall to $29,700, and then continue to decline to $24,000, $19,000, and even possibly $10,000 per coin. It is worth recalling once again that bitcoin has always lost 80-90% of its value when it finished another bullish trend.

Exchange Rates 04.08.2021 analysis

Technically, bitcoin has worked out the target level of $40,700 with a margin and reached the level of $42,300. However, for the third day in a row, bitcoin is falling. We still expect a decline in the quotes of the main cryptocurrency to the level of $29,700. So far, the fundamental background remains clearly not on the side of bitcoin. Therefore, now it is possible to sell the cryptocurrency.

*The market analysis posted here is meant to increase your awareness, but not to give instructions to make a trade.

Paolo Greco,
Analytical expert of InstaForex
© 2007-2021
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