Bear market progression and shift in the sentiment
Updated
During the summer, we warned investors about the upcoming corporate underperformance and downgrades in forward guidance for the third quarter of 2022. We also stated that this would mark the transition from the first stage of the bear market into the second stage. Interestingly, we have noticed a similar trend in the cryptocurrency community.
Numerous social media influencers, celebrities, and even investors like Mike Novogratz have started to reconsider their views on the market and backtracking on earlier predictions for sky-high prices. We believe this seismic shift in the sentiment among prominent people is analogous to what is happening in the stock market. Therefore, the market bottom could still be farther than many suggest.
This view is supported by the fact that the FED will continue to tighten monetary conditions, which will inadvertently lead to higher risk aversion and lower prices for cryptocurrencies. In addition to that, the marketplace is still full of bullish calls for the primary trend reversal and market bottom, not suggestive of capitulation among investors. As a result, we continue to maintain a bearish stance on Bitcoin. Accordingly, our price targets at 15 000$ and 13 000$ stay unchanged.
Illustration 1.01
Illustration 1.01 shows the daily chart of BTCUSD. Red, green, and white arrows show the relationship between the price and volume. If the price breaks above the short-term resistance, it will bolster the bullish case (for the short-term). However, we do not expect it to impact the primary trend.
Please feel free to express your ideas and thoughts in the comment section.
DISCLAIMER: This analysis is not intended to encourage any buying or selling of any particular securities. Furthermore, it should not be a basis for taking any trade action by an individual investor. Therefore, your own due diligence is highly advised before entering a trade.
Numerous social media influencers, celebrities, and even investors like Mike Novogratz have started to reconsider their views on the market and backtracking on earlier predictions for sky-high prices. We believe this seismic shift in the sentiment among prominent people is analogous to what is happening in the stock market. Therefore, the market bottom could still be farther than many suggest.
This view is supported by the fact that the FED will continue to tighten monetary conditions, which will inadvertently lead to higher risk aversion and lower prices for cryptocurrencies. In addition to that, the marketplace is still full of bullish calls for the primary trend reversal and market bottom, not suggestive of capitulation among investors. As a result, we continue to maintain a bearish stance on Bitcoin. Accordingly, our price targets at 15 000$ and 13 000$ stay unchanged.
Illustration 1.01
Illustration 1.01 shows the daily chart of BTCUSD. Red, green, and white arrows show the relationship between the price and volume. If the price breaks above the short-term resistance, it will bolster the bullish case (for the short-term). However, we do not expect it to impact the primary trend.
Please feel free to express your ideas and thoughts in the comment section.
DISCLAIMER: This analysis is not intended to encourage any buying or selling of any particular securities. Furthermore, it should not be a basis for taking any trade action by an individual investor. Therefore, your own due diligence is highly advised before entering a trade.
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