Gareth Soloway, the Chief Market Strategist of InTheMoneyStocks.com thinks Bitcoin will make a big move downwards in 2022. However, he has recently bought the Bitcoin dip, and expects a short-term recovery.
In a recent interview for Kitco, Soloway maintained his prediction of a macro price fall for Bitcoin. His view is that the number one cryptocurrency could fall as far as $20,000, but then believes that the move higher from there could take it past $100,000.
The strategist was proved right recently when he said that he didn’t think calls for $100,000 before the crash were correct. Instead, his view was that the Bitcoin chart was showing a double top at the time.
He thinks that bigger players than retail were unloading into the all-time-highs, first at $67,000, and then at $69,000. According to him, the ensuing price dump confirmed a failed breakout.
When stating that he was a shorter term trader, he said that for him, “fear and greed rule the markets in the short term”.
“The only thing that matters is greed and fear, and what we’ve seen lately is fear starting to swoop in. That’s going to be the predominant force in Bitcoin till it flips.”
For his short term outlook, the trader bought bitcoin at around $48,000, saying that it had hit major support and a prominent trendline. He expects bitcoin to climb higher to around $52,000 or $53,000 before taking profits on this swing trade.
He believes that what will weigh heavily on the king of the cryptocurrencies is the still incredibly stubborn amount of leverage in the system, and the fact that any stock market falls will drag crypto down with them. His view is that the fear that is currently in the stock market must also seep into the crypto market.
Soloway sees his $20,000 bitcoin becoming reality as the Fed spreads more and more worry into the markets with its “tightening” and “tapering” calls, causing a deleveraging to happen and a resulting crash for crypto.
He has a belief that when Jerome Powell was given his second term as chairman of the Federal Reserve, he was told by the Biden administration (with the midterm elections approaching) to get inflation down, given the massive amount of democratic voters with middle income jobs that are getting hurt by the rising inflation.