Bitcoin has had a tough time recently, however, the one analyst at Bloomberg is predicting even tougher times ahead. He is predicting that Bitcoins price is possibly heading towards $1,500.
Bloomberg technical analyst Mike McGlone explained in a report released today that bitcoin is currently stuck in stiff downward momentum.
The Average Directional Index (ADI) suggests Bitcoin is at a peak not seen since July. When the indicator is high, it shows high levels of downward trend strength. Mr McGlone said that he sees a potential price target of $1,500 for bitcoin. If correct that would mean another 60 percent fall from its current rate, which is already down 81 percent from last year’s all-time high.
“There’s little to prevent fading bitcoin prices from reaching the continuous mean of $1,500 […] A rush to the exits among investors seems to be in place,” McGlone stated, who pointed the finger at the Bitcoin Cash hard fork and tax-based selling as the main catalysts for the downward momentum.
“The hard fork was a key trigger that signaled the technology is way too nascent. You had these dicey characters threatening to destroy each other and institutions said ‘It might be best if we stay away from this for a while.’”
The Bloomberg report also discusses the recent SEC crackdown on ICOs and its hesitancy to approve a bitcoin ETF.
November saw bitcoin dive over 40 percent, which was the largest monthly price drop for the asset in the past seven years.
“The trend is lower prices, lower volatility, reduced speculation, and the preponderance of stable coins,” McGlone said. He points out the need for crypto assets to set a firm price base. Unfortunately, “we’re not near that base yet,” he stated.
McGlone is not the only Bitcoin pessimist. Other crypto experts predict Bitcoin dropping further as well, but some have set a bottom higher than $1,500. Anthony Pompliano’s thoughts on a bottom for bitcoin are:
“85 percent from the all-time high is about where we’ll end up. Puts it around $3,000. Came close over the weekend but probably a little bit more to fall,” Pomliano stated.
Tom Lee appears to be the only Bitcoin optimist out there. He is still forecasting a $15,000 end of year price, although very few share his optimism.