It’s been a bad week for the cryptocurrency market. For investors, the big question is how low will cryptocurrency prices go?
After the prices of bitcoin, ethereum and other cryptocurrencies saw big drops this week, several experts say it could get even worse amid a sell-off of risky assets by investors. Bitcoin’s price fell more than 30% over the past week to below $20,000 on Saturday, and Ethereum followed a similar trend. the second largest crypto fell below $1,000 on Saturday.
Reading: How low will bitcoin go
The stock market rallied Wednesday afternoon after the Federal Reserve raised interest rates by 75 basis points, the biggest increase since 1994. But the crypto market didn’t follow through, which could be “a worrying sign for some investors,” according to edward moya, senior market analyst at oanda.
“bitcoin failed to stage a rally despite a broad rally on wall street following the federal open market committee (fomc) decision. If a big rally on wall street can’t get crypto traders excited, bitcoin could be in trouble,” says moya. “$20,000 level holds but no one seems to want to get back into cryptocurrency trading.”
Many experts are warning that this may be the beginning of a “crypto winter”, a prolonged period in which prices fall and stay low, as happened between early 2018 and mid-2020. If bitcoin falls below $ 20,000, several experts predict it could go much lower.
Having fallen more than 30% over the past week, investors are wondering where the bottom may be for bitcoin and other digital assets.
how low will bitcoin and ethereum fall?
Bitcoin first dipped below $30,000 last week, steadily dipping to $25,000 on Sunday before dropping substantially to $21,000 on Monday. the largest crypto slipped further to $20,000 on Wednesday and continued to hover around that range on Friday. Ethereum reacted in a similar way, falling as much as 30% over the past week to a new 18-month low of $1,000.
As the two most well-known cryptocurrencies in the market continue to fall, you may be wondering how low bitcoin and ethereum could fall and whether you should buy the dip. While it’s impossible to say for sure, many crypto experts have an idea of where bitcoin and ethereum could bottom based on technical charts and historical data. Here’s how bitcoin and ethereum prices could go down in the coming weeks or months, according to these three experts:
viewpoint: entrepreneur and author of “cryptocurrency investing for dummies”
lower projection: bitcoin could drop to $11,000
Why: The crypto market is in the midst of a bearish sentiment cycle as investors are largely moving away from risky assets. Several factors are driving the negative sentiment in the stock and crypto markets right now, including inflation, an unstable stock market, rising interest rates, and recession fears. As a result, bitcoin is down nearly 70% from its all-time high of $68,000, breaking below several key technical levels in recent weeks. Cryptocurrency prices could continue to fall if the unstable macro environment does not improve in the short term.
point of view: cryptography expert and educator
lower projection: ethereum could drop to $750 and bitcoin could drop to $10,000
Why: The price of ethereum is now about the same as its price in early 2021. Generally, in bear markets, ethereum and bitcoin can fall as much as 85%, says o. Ethereum hit an all-time high in November 2021 at about $4,800, so an 85% correction would result in around $750. It’s not going to be a straight shot down, though. According to o’s technical analysis, there are several resistance levels at $1700 and $1885, so it is likely that we will see a volatile reversal to the upside before Ethereum bottoms out completely.
point of view: venture capitalist and founder of delta blockchain fund
lower projection: bitcoin could drop to $14,000 and ethereum could drop to $500
Why: The crypto winter is here, and it is unlikely that we will see a significant rally over the next 12-18 months. Fears of a recession are pushing investors to liquidate risky assets, and the collapse of Luna and TerraUSD last month and lender Celsius pausing withdrawals this week have further eroded confidence in the space. If the broader market sell-off deepens, Gupta expects more crashes in the crypto space. that, in turn, could further erode investor confidence in the crypto market and prices could fall further.
This Week’s Crypto Crisis: Should You Buy The Dip?
There is never a “perfect” time to start investing, as it is impossible to time the market. But experts say now might be a good time to enter the market while prices are low, after you’ve assessed your risk tolerance (cryptocurrencies are highly speculative) and covered other financial priorities, like saving for an emergency and investing in money. a more traditional way. retirement fund. Potential investors looking to buy into this week’s dip should understand that fluctuations are normal and be prepared for this type of volatility in the future.
Even if you invest now, with prices relatively low, be prepared for them to drop even further. that’s why it’s important to only put in what you’re comfortable losing. experts generally recommend allocating less than 5% of your portfolio to cryptocurrency investments.
If you plan to buy the dip, you may be wondering which cryptocurrencies to invest in. Although the potential growth of Ethereum and Bitcoin is highly speculative, they are still among the best cryptocurrencies you can invest in right now, based on NextAdvisor’s investment score and experts we’ve spoken to over the past year. bitcoin and ethereum are the two largest cryptocurrencies by market cap and trading volume, making them good choices if you’re just starting out on a crypto investment journey.
Bitcoin has the highest score of all cryptocurrencies, with Ethereum right behind. Here’s how our score shakes up for 10 cryptocurrencies that are consistently among the best by market cap, excluding stablecoins, for reference: