Bitcoin price is teetering on the brink of a quick and painful 80% retracement from current levels. This is according to Peter Brandt, a veteran trader known for accurately forecasting the crypto market summit in December 2017.
Bitcoin Price: 80% Correction Coming?
The largest cryptocurrency by market capitalization closed May, a historically bullish month, well in bear territory. This was mainly because bitcoin has faced massive downward pressure from traditional markets amid quantitative tightening from the central bank and the ongoing fallout from Russia’s invasion of Ukraine.
The damage to investor confidence caused by the dramatic collapse of Terra’s UST stablecoin and LUNA token in May was also too great to overcome. While Terraform Labs has successfully relaunched the collapsed network with a new chain, it hasn’t done much to improve overall market sentiment.
Most analysts agree that bitcoin has entered a healthy breathing period and may tank slightly lower, but Peter Brandt’s assessment is remarkably bold. In a tweet dated June 4, Brandt noted that the benchmark cryptocurrency is about to record its fourth drop of more than 80% since 2011.
Brandt responded to a tweet from a pseudonymous crypto analyst named Cheds, in which he predicts that bitcoin could dip to the $12,000 level in the near term. If this comes to fruition, it would be the first time a correction has slipped below the previous 2017 all-time high of nearly $20,000.
Bitcoin now appears to be trading at a make or break point. In short, the near-term future of the cryptocurrency will depend on its ability to strongly hold the key support level of $29K. But current circumstances suggest that there could be more room to go down before the end of the crypto winter.
Bitcoin gave investors a glimmer of hope early this week after staging a mini-rise to first recapture the $30,000 zone on Monday, before briefly hitting $32K the following day.
In all, the flagship cryptocurrency lost more than 18.8 percent of its value in the past 30 days, while its market cap shrank from $760 billion to its current value of $566 billion.
Investors will likely continue to assess bitcoin price action before committing capital. Nevertheless, some analysts remain optimistic about bitcoin’s long-term trend due to the positive developments in adoption over the past few months and its robust fundamentals.