Bitcoin is now at $38,000, its lowest level in four months. The digital asset is at a critical point, as it has managed to maintain its above-average position despite all the dips and crashes of the past month. Although most people would prefer to believe that it is a temporary problem that will be fixed soon, Nicholas Merten, an analyst has advised investors that they should expect more volatility.
Be Prepared for More Downside
Merten gave a grim analysis on bitcoin in a video he posted to his YouTube channel. Merten begins by acknowledging the negative experiences many have had in the market and believes that there is more to come. The analyst was wrong, however. After the recent rebound, digital assets experienced even more declines.
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Merten highlighted the fact that gains made from bitcoin’s jump of $41k to $44k were quickly lost and that support levels are not very significant as bitcoin falls in the downtrend.
The market will see major volatility, which will bring the price down to levels that have not been seen for about one year. Compare the current market with May 2020 to see the price drop to around $29,000. “It’s just likely at this point that we repeat what we saw back in May to some degree,” he said. “Having a correction down to this range [$29,000 to $30,000], getting people towards what I would define as max pain It basically defines the point of peak fear when everyone, even the bulls are convinced that we’re in a bear market.”
Analysts expect that bitcoin will experience more volatility, with a range of 20-30% to 30 percent. This would mean the Bitcoin price is within the predicted range.
BTC falls below $37k first time in 4 months. Source: BTCUSD from TradingView.com| Source: BTCUSD on TradingView.com
Still Bullish On Bitcoin
Merten’s gloomy bitcoin forecast does not necessarily mean that the analyst will be bearish long-term. He stated that even though bearish trending in the bitcoin market, he is still a bitcoin bull.
“We’ve been bearish in the short term over the past couple of weeks and we believe that there is still more downside to go, [but] I’m still a long-term bull.”
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Merten also reiterates that the bull market remains in place. When prices fall as quickly as they do now panic sets in and most people believe that the bull market has ended. Mertern says this isn’t true. Mertern explained that bitcoin might be headed towards $150K to $200K as an upward correction.
“I believe that we’re still in a bull market, not a bear market. It’s very likely that we could see this correction, but at the same time, it could be the catalyst to finally set ourselves up on the next uptrend and charter towards the $150k range, $200k range for Bitcoin.”
At the time of writing, bitcoin’s price is down 9.61% to be trading at $37,945.
Featured Image from Medium. Chart from TradingView.com