Long term Crypto market outlook
Updated
I have not looked closely at TOTAL crypto chart for a while, but it works bit better with Fibonacci tools and overall levels where we might expect 2022 Bear market could go. I won't go into macro details, as most already know what is here and what is coming, so there is no doubt we are going lower. Question is how low?
I had 800b TOTAL mcap for crypto marked for a while as a target even before the March rally, but its interesting to see it actually aligns perfectly with Fibo extension and the most likely target that anyone should be prepared for. What would that mean for Bitcoin's price? It would coincide with hitting around 200WMA so 22-23k area and of course be disastrous for altcoins, but at this point no one should really care about them.
Why did I mark 2nd level? Well the main reason is if stock market enters a panic zone due to rising inflation, costs of energy, food shortages etc., similar to 2008 recession, all hell will break lose on crypto market that did not experience yet that kind of selling pressure. If you consider how weak was the price action to the upside since we dropped closer to 25k on BTC in last sell-off and that we barely touched 23% Fibo retrace, the likelihood of extending well beyond 800B is actually quite high (I am putting it between at around 40% right now, if we drop from here after FOMC meeting next week without any move closer to 35k then I would increase likelihood to 50%).
All this I think will play out in the next 6 months and the sooner TOTAL hits 800b area the more likely that it would drop lower. Keep an eye on that and BTC Dominance (still rising and will rise more), don't get tempted into altcoin purchases until we are on our way out.
I had 800b TOTAL mcap for crypto marked for a while as a target even before the March rally, but its interesting to see it actually aligns perfectly with Fibo extension and the most likely target that anyone should be prepared for. What would that mean for Bitcoin's price? It would coincide with hitting around 200WMA so 22-23k area and of course be disastrous for altcoins, but at this point no one should really care about them.
Why did I mark 2nd level? Well the main reason is if stock market enters a panic zone due to rising inflation, costs of energy, food shortages etc., similar to 2008 recession, all hell will break lose on crypto market that did not experience yet that kind of selling pressure. If you consider how weak was the price action to the upside since we dropped closer to 25k on BTC in last sell-off and that we barely touched 23% Fibo retrace, the likelihood of extending well beyond 800B is actually quite high (I am putting it between at around 40% right now, if we drop from here after FOMC meeting next week without any move closer to 35k then I would increase likelihood to 50%).
All this I think will play out in the next 6 months and the sooner TOTAL hits 800b area the more likely that it would drop lower. Keep an eye on that and BTC Dominance (still rising and will rise more), don't get tempted into altcoin purchases until we are on our way out.
Note
First target reached, remains to be seen if we will get some consolidation at this level or even an attempt on a small pullback towards 1T
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