Gareth Soloway, Chief Market Strategist of Verified Investing.com, recently shared his insights on the current state of Bitcoin. According to him, Bitcoin has been closely mirroring the equity markets. While both markets exhibit some weakness, Soloway finds Bitcoin’s decline particularly worrying.
In a recent interview with David Lin, Soloway emphasized that this period should ideally see Bitcoin reaching new all-time highs, especially with the stock market performing well. However, contrary to expectations, Bitcoin is showing signs of weakness. Despite an overall bullish trend channel, Soloway noted that if the market takes a downturn, Bitcoin could fall back to the $50,000–$49,000 range, which he identifies as crucial support levels.
Will Bitcoin Dip Below $30k?
If Bitcoin manages to hold the $50,000–$49,000 support levels, it could present a good buying opportunity. However, Soloway advises caution if these levels break, suggesting that investors should stop out immediately. A collapse in the stock market could potentially drive Bitcoin down to the low $30,000s.
He also highlighted that many new retail investors have entered the Bitcoin market, spurred by the rise of spot ETFs. If the market turns negative, these investors could panic, leading to a further decline. A 50% correction is typical in Bitcoin bear markets, making a drop to the low $30,000 range plausible if Bitcoin enters a bear market phase.
Is $100k On The Horizon?
The $52,000–$49,000 range serves as a critical support level for Bitcoin. Should Bitcoin break below this range, there may be no substantial support until the low $30,000s. Conversely, if Bitcoin surpasses the $69,000–$70,000 resistance level, it could trigger a rapid ascent to $100,000 within a few months as more capital flows into the market.
Why Didn’t Bitcoin Hold $70k Levels?
When asked why Bitcoin failed to maintain its previous all-time high of $70,000 earlier this year, Soloway attributed it to a shift in market trends. Instead of tech stocks like Microsoft and Nvidia leading the charge, more defensive stocks such as Walmart are now driving the market. Bitcoin, being a riskier asset, has not benefited from this shift as investors gravitate towards safer options. Soloway concluded that Bitcoin’s short-term struggles are a result of this trend towards safer stocks.
