Rising U.S. inflation and overblown fears about Evergrande contagion might be factors behind BTC’s recent pullback, but most analysts view the drop as a “necessary retest.” Volatility is the name of the game in the cryptocurrency market and the Nov. 11 evening sell-off in the price of Bitcoin (BTC) is a reminder that new all-time highs are often followed by sharp whipsaws to underlying support levels.
Data from Cointelegraph Markets Pro and TradingView shows that after dropping to a low near $62,800 late on Nov. 10, the price of Bitcoin managed to claw its way back up to the $65,000 level where bulls now look to consolidate and regroup for another push higher.
Here’s a look at what analysts are saying about the outlook for Bitcoin and the cryptocurrency market as concerns about rising inflation dominate the news headlines in the U.S.
The sight of a rapid $7,000 decline in BTC may have come as a shock to some, but for analyst and pseudonymous Twitter user ‘Nunya Bizniz’, the price action over the past couple of days is par for the course and transitory in nature based on Bitcoin's past performance.
As observed in the chart below which shows the Bitcoin price along with its 20-day moving average (20-MA), it’s common for a run-up in the price of BTC to be followed by a pullback that touches or briefly dips below the 20-MA before once again heading higher.
Insight into the macro factors at play was provided by Jean-Marc Bonnefous, head of asset management at Tellurian ExoAlpha, who highlighted the fact that “there has been much talk about the impact of the Evergrande story on the recent sell-off in the market.” As a way to make the development more relatable to cryptocurrency holders, Bonnefos stated that the “Evergrande news is to equities what Elon Musk tweets are to cryptos” in that it is “somewhat manipulated news to move markets.”
According to Bonnefos, “the crypto markets seem to be overreacting” to the headlines, and “the recent dip is probably more of a technical consolidation after the sharp rally of the last few days.”
And it’s not just negative headlines about Evergrande and tweets from influencers that are affecting the price action in the crypto market. According to Bonnefos, the recent 6.2% rise in the U.S. Consumer Price Index (CPI) also points to a major factor influencing the global financial markets and the price of Bitcoin.
Bonnefous said, “The recent shocking inflation numbers in the U.S. should be a supportive fundamental driver for Bitcoin prices, beyond the short term tactical selling pressure.”
A final word of encouragement was offered by analyst Twitter user ‘GalaxyBTC’, who posted the following chart outlining one possible trajectory for the price of BTC to reach $75,000 in the short-term.
The analyst said, “Yesterday's retest was needed to continue the bull run in a healthy manner. I think we will start pumping harder now.”
The overall cryptocurrency market cap now stands at $2.847 trillion and Bitcoin’s dominance rate is 43.1%.
|#||Crypto||Prediction||Accuracy||CVIX||Price||24h||7d||Market Cap||7d price change|
|1||BTC||Bitcoin predictions||91.2%||10||$26 805.87||-1.40%||2.56%||$519 755 870 988|
|2||ETH||Ethereum predictions||94.4%||5||$1 854.67||-0.84%||4.20%||$223 015 422 400|
|3||USDT||Tether predictions||96%||1||$1.000096||-0.02%||0.03%||$83 230 335 223|
|4||BNB||Binance Coin predictions||95.6%||1||$303.98||-1.00%||-0.22%||$47 377 323 224|
|5||USDC||USD Coin predictions||94.4%||1||$0.999905||-0.01%||0%||$28 877 501 003|
|6||XRP||XRP predictions||76.8%||37||$0.505541||-0.88%||12.34%||$26 279 740 617|
|7||ADA||Cardano predictions||90%||10||$0.363936||-3.17%||2.01%||$12 695 439 313|
|8||STETH||Lido stETH predictions||96%||1||$2 941.39||-0.40%||-3.32%||$10 258 752 564|
|9||DOGE||Dogecoin predictions||84.8%||17||$0.071531||-0.10%||1.71%||$9 984 428 154|
|10||MATIC||Polygon predictions||81.2%||35||$0.889823||0.05%||1.41%||$8 257 084 812|
|11||SOL||Solana predictions||79.6%||29||$20.61||-0.54%||6.81%||$8 175 590 615|
|12||WTRX||Wrapped TRON predictions||81.2%||37||$0.074658||-1.32%||-3.61%||$7 590 887 095|
|13||LTC||Litecoin predictions||80.4%||37||$92.37||3.38%||9.85%||$6 747 710 768|
|14||TRX||TRON predictions||81.6%||35||$0.074386||-1.89%||-3.97%||$6 711 481 387|
|15||DOT||Polkadot predictions||90%||10||$5.22||-2.17%||-0.51%||$6 213 935 139|
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