Analysts are now increasingly confident that the world's biggest cryptocurrency has "bottomed out."
Bitcoin has staged a rather impressive bounce back after experiencing a scary plunge below $30,000.
The world’s biggest cryptocurrency had slumped to lows of $28,893.62 on Tuesday — setting a new year-to-date low in the process.
But Bitcoin has managed to recover aggressively in the past 24 hours or so. At the time of writing, it’s rallied by more than 18%, with prices returning to $34,211.
According to a number of analysts, this indicates that BTC has now bottomed out — with “strong support observed” as the cryptocurrency was “scooped up” at the $30,000 mark.
In a report released today, Stack Funds pointed to how MicroStrategy is continuing to accumulate Bitcoin, with whales re-entering the market as their appetite for risk returns. The authors added:
“Putting all these factors together, we believe Bitcoin is very close to the bottom, at least in this current wave.”
Bloomberg Intelligence’s Mike McGlone also described $30,000 as a “line in the sand” — drawing parallels to the shock drop to $4,000 that was seen in March 2020. In other words, he believes Bitcoin has the potential to mount a strong recovery following this correction.
Despite the current optimism that better days are yet to come, it’s worth noting that Bitcoin is currently on track to secure its worst second-quarter performance ever.
Data from Bybt shows that BTC has already fell by 42% in Q2 — a stark contrast from the gains of 42% and 159% seen over this period in 2020 and 2019 respectively. Bitcoin has only booked losses in two Q2s in its history: 2018 and 2013.
Of course, there’s one thing that upbeat Bitcoin analysts can’t forecast — and that’s news. China’s crackdown on crypto has created a slew of negative headlines, and more could be on the way.
The latest Bitcoin Crypto Fear & Greed Index is flashing a score of 14 — “Extreme Fear.” That’s up four points on yesterday.