Veteran trader Peter Brandt saw Bitcoin crash further after falling 50% in May


Bitcoin (Bitcoin) Even after its decline, it still faces the prospect of further decline Prices rebounded strongly after falling from US$65,000 to US$30,000 in May 2021.

Therefore, this is reflected in the latest statement by Peter Brandt, CEO of global trading company Factor LLC, who questioned the continuity (if not asserted) of the continued relief rebound in the Bitcoin market, especially in After the price plummeted by more than 50%.

This experienced commodity trader challenged the “BTC price historian” to find an instance from the past ten years that allowed Bitcoin to set a new record high in seven months after falling by more than 50% . He also asked to mention a situation where a 50% drop in the price of Bitcoin did not result in a correction of at least 70%.

One of Twitterati Respond to There are two examples: the March 2020 rebound, in which the price of Bitcoin fell from the long-term cyclical high of $13,880 in March, from $3,880 in June 2019 to $3,850, eight months (not even seven) Month) recovered to a historical high above $20,000; in the 2013 bull market, the cryptocurrency rose by more than 2,450% in the eight months after it bottomed out in an 80% overnight crash and rebounded to around $45.

Bitcoin price trends during the trading hours from April to November 2013. Source: TradingView

Brand said, “Neither is right” because it took another month for the price of Bitcoin to recover to a record high in both cases. However, due to the time frame they chose and the reason they tried to prove the bias in the cryptocurrency market, the veteran’s problem is still not mysterious enough.

On-chain analyst Willy Woo guessed, Brandt tried to predict Further price plunge in the Bitcoin market, Based on the historical response of cryptocurrencies to more than 50% price correction events.

Woo tried to pour cold water on Brandt’s fractal bearish market outlook by referring to “fundamentals.”

Woo responded: “This decline in scale and long-term recovery start from the point where the price exceeds the basic valuation.”

“The difference with this setup is that the price is below the fundamentals. As a guide, the COVID dump fell below the fundamentals, so it quickly recovered.”

Woo himself did not explain the meaning of the term “fundamental principle”. His active followers on Twitter took over the allegation to clarify that the “network effect” the analyst mentioned was due to the fact that investments in gold and cash-oriented portfolios accounted for a place in anti-inflationary assets.

Bitcoin rose from its bottom in March 2020 to a new record high of nearly $65,000, mainly because investors believe it is scarce Fight against high inflation.

Looking back, curbing interest rates, a $120 billion bond purchase plan, and the US government’s A trillion-dollar stimulus plan Designed to curb the consequences of the COVID-19 pandemic on the U.S. economy-resulting in investors having to risk using assets such as Bitcoin and stocks.

After the March 2020 crash caused by the pandemic, Bitcoin and the Standard & Poor’s 500 index surged simultaneously. Source: TradingView

May 12, U.S. Bureau of Labor Statistics Reveal The country’s consumer price index (CPI) has increased by 4.2% year-on-year, the fastest increase since 2008.This tends to increase the attractiveness of Bitcoin among individuals and organizations seeking to hedge against inflation in the long term, especially when consumer prices punish depositors when the price of Bitcoin rises. Forcing the U.S. dollar valuation to fall.

“This is the number one reason why I am optimistic about things like Bitcoin,” Say Anthony Pompliano, the investor of Pomp Investments, was established in January 2021.

“It is the world’s largest protector of wealth. There will be great volatility in the short term, but for a long time, Bitcoin will shine. It does a good job of maintaining purchasing power and avoiding the danger of devaluation of fiat currencies. .”

At the same time, some analysts expect Bitcoin to continue to decline, which is in line with what Brandt has suggested. Morgan Stanley analyst Richard Durant is one of them. call Bitcoin is an “emotional asset” that cannot grow without a positive price catalyst, adding that “it is not clear what they might be.”

Analyst at BiotechValley Insights write Bitcoin’s rise in anti-inflation concerns has not made the flagship cryptocurrency a hedge. They mentioned the price crash on May 19, which occurred a week after the U.S. Bureau of Labor announced the CPI reading of 4.2%.

They pointed out: “Bitcoin is related to high-risk momentum growth stocks such as TSLA, and is more related to safe-haven assets such as gold or bonds.”

At the same time, Brandt, who correctly predicted the 2018 Bitcoin price collapse, seems to be more technically concerned about the next market prospect. In March 2021, he had predicted that the BTC/USD exchange rate would reach US$200,000 in the third or fourth quarter of this year.

At the same time, Brandt is also Decide Just as the price of Bitcoin was close to breaking through $12,000 in September 2020, he should keep his money in stocks instead of cryptocurrencies. The cryptocurrency closed at around $29,000 at the end of the year.

March 2020, Brandt expected BTC dropped to $1,000. However, the cryptocurrency reversed its bearish course after testing the level above $3,800 as support.