- Bitcoin could reach a new all-time high, but may face a significant correction first.
- Analysts note the risk of a major price drop if current trends break down.
- A recent crypto market crash followed the U.S. announcement of new tariffs on Chinese goods.
- Experts urge caution with leverage and emphasize long-term risk management.
- Federal Reserve policy changes and economic data may support higher crypto prices in the coming weeks.
Bitcoin prices may soon return to record highs in the upcoming week, but traders should prepare for potential volatility and corrections. This outlook comes after a significant downturn hit the cryptocurrency market following the U.S. government’s announcement of a 100% tariff on some Chinese goods.
Veteran trader Peter Brandt said that Bitcoin might either experience a major shakeout before quickly surpassing its all-time high of $125,100 or see a drop that could push prices down as much as 50%. Brandt explained, “Either a huge shakeout, which would be confirmed by an ATH quickly within the next week or so… Or a violation of the parabola, which every time in the past has produced a 75% price decline. I think the day of the 80% decline is over, but perhaps back to $50,000-$60,000 and test the lower skin of the banana.”
Following Friday’s market crash, Bitcoin fell from about $121,000 to a low near $102,000 before rebounding to roughly $112,400, according to CoinMarketCap. Over $19 billion in liquidations took place during this period. Charles Edwards of Capriole Investments advised traders to be cautious with leveraged positions, noting, “If anything, this weekend was a reminder you have to be so careful with leverage, and even multiples above 1.5x are dangerous.” He stressed the importance of considering long-term and multi-year risk.
Some analysts remain positive about Bitcoin’s future amid shifting central bank policies. Arthur Hayes, former co-founder of Bitmex, wrote on X that the end of Federal Reserve quantitative tightening could provide an opportunity to buy, stating, “Back up the… truck and buy everything.” Quantitative easing refers to central banks making it easier to borrow money, which often benefits assets like cryptocurrency.
Pav Hundal of Swyftx pointed to key economic numbers, referencing falling oil prices and signs of weakness in the U.S. labor market. He said, “The Fed has a mandate to target full employment, and it all just feels inevitable that we’ll see further rate cuts this month. This is a goldilocks zone for Bitcoin.” Lyn Alden, a macroeconomist, suggested the upcoming quarter could also be favorable for Bitcoin in a recent podcast (source).
Bitcoin’s value dropped by 7.5% over the last week, reflecting ongoing market uncertainty following these major economic and policy updates.
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