Bitcoin Bear Market Ahead? Analyst Warns of 33% Price Drop
According to Timothy Peterson, author of the author of Bitcoin’s model of value, the cryptocurrency industry may be on the verge of another bear market.
Despite the persistence of economic uncertainty, the Fed has analyzed the interest rate prudent position.
Analysts explain how the bear market develops
Peterson warned in a recent analysis shared on X (Twitter) that the market is currently overvalued. This makes it vulnerable to downturns, he said. Although such a decline needs to be triggered, he suggests the Fed’s decision Keep interest rates stable Probably enough to bring it up.
“It’s time to talk about the next bear market. There’s no reason to think it won’t happen now. Valuation proves that. What it needs is a trigger. I think the trigger might be simple, that the Fed doesn’t lower the rates at all this year,” he said. Write Peterson.
Peterson’s analyze A parallel line is reached between past market downturns and current conditions. He used the Nasdaq as a reference point and estimated that the bear market could last for 7 to 14 months.
Given that the Nasdaq is currently overvalued by 28%, he expects to drop about 17%, reducing the index to 15,000.
Peterson applied these forecasts to Bitcoin, which is expected to drop 33%, reducing the price of Bitcoin to around $57,000.
“Multiply by 1.9. Nasdaq additional.
However, he noted that opportunistic investors can step on the ground early. Such interventions could prevent Bitcoin prices from falling so low that they could find support around $71,000.
This coincides with Arthur Hayes’ latest analysis. As Beincrypto reports, the founders of Bitmex claim Bitcoin could fall to $70,000 Before the potential rebound.
So are analysts Highlight Bitcoin’s air gap is below $93,198 until around $70,000 with little noticeable support.
The role of the Fed in a market downturn
Meanwhile, about a month ago, Fed Chairman Jerome Powell said the central bank is being Don’t rush to lower interest rates. He is His speech last week. Powell spoke at a policy forum in New York, stressing the need for patience.
“We don’t need to be in a hurry and are waiting for a clearer position,” Powell statement.
Powell’s remarks arise amid the heightened economic uncertainty of President Donald Trump Trade policy changesimmigration, fiscal policy and Regulation. and inflation The Fed hovered around 2.5%, focusing on tackling these challenges with caution.
Despite market expectations for tax cuts this year, Powell has made it clear that the Fed will wait and see before adjusting monetary policy.
Besides fearing the upcoming Fed recession, Bitcoin has recently declined Fed warns of possible recession. The Fed expects GDP to drop by 2.8% in 2025 in the first quarter (Q1), which has sparked fear of economic instability. This negatively impacts investor sentiment.
Despite these warnings, Peterson still doesn’t believe that the looming bear market is imminent. He believes that the current market situation is not as euphoric as the previous bubbles. The analyst also explained that bearish sentiment among investors can indicate long-term buying opportunities rather than selling signals.
Beincrypto Data display As of this writing, Bitcoin is trading at $86,026, down 0.1% since Sunday’s meeting opened.
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