Top analysts are divided on the path forward for the crypto market.
In a recent interview with CNBC, Tom Lee of Fundstrat remained convinced that the crypto market could see a turnaround.
Lee, who is also the president of BitMine Immersion, the world’s largest Ethereum treasury company, said everything is in place for the crypto market to bottom out.
“BitMine crypto advisor Tom deMark is waiting for time and prices to align, $77,000 for BTC and $2,400 for ETH. So all the pieces are in place for crypto to bottom out right now. As long as crypto fundamentals are good, the rally should be in place.”
Source: X/Tom Lee
According to him, the decline in cryptocurrencies was expected following the announcement and confirmation of the new Fed president.
But he added that the scale of the crypto market selloff was “more than expected,” noting that there was no “leverage” immediately after October 10. deleveraging event.
Galaxy predicts further decline for BTC
BTC fell 11% last week from $90,000 to $75,000. It has rebounded slightly to $78,000 at the time of writing.
For Alex Thorn, head of research at Galaxy, however, the crypto asset could see more losses due to the “lack of near-term catalysts.”
In a recent note to customers, Thorn wrote,
“Onchain data, weakness at key price levels, macroeconomic uncertainty, and lack of near-term catalysts suggest that BTC will trade lower toward the 200-week moving average over the coming weeks or months.”
Source: Galaxy Research
Currently, the 200-week moving average (MA) sits around $50,000, and Thorn added that this level has been a key buying area in the past.
“If Bitcoin falls toward the 200-week moving average or realized price, these levels should present strong entry points for long-term investors, as they have in the past.”
Interestingly, some whales with more than 1,000 BTC were already taking advantage of discounted prices to add positions, Bitfinex. note.
Source: Glassnode/Bitfinex
Will $70,000 last?
For her part, Aurélie Barthere, senior research analyst at Nansen, a crypto analysis platform, also shared a bearish outlook similar to that of Thorn. He discussed potential changes if Kevin Warsh is confirmed as the new Fed chairman.
In an emailed statement, Barthere told AMBCrypto:
“Changing the Fed’s operating regime and reducing the balance sheet will not be simple (the Committee needs to be convinced), but I think markets are starting to price in a low probability of QT (quantitative tightening) resuming. This is a bearish crypto.”
Meanwhile, the 2021 cycle also rhymed with the current price action, with fractals (blue line) suggesting that BTC could slide as high as $70,000. This is the high of the past cycle, and past bear markets tend to stabilize around the highs of previous market cycles.
Source: BTC 2021 vs 2025 model, TradingView
Final Thoughts
- Fundstrat’s Lee said the crypto market bottom forming could be likely as “all the conditions” were aligned.
- However, macroeconomic headwinds and the strong resemblance between the 2021 trend and current price developments call for increased caution.
