When will Bitcoin return? How low will it go? Will he be back in 2022?
How low will Bitcoin go?
It is increasingly likely that BTC reached its low in 2022 on June 18 at $17.7 thousand
Using correlation with inflation data, our prediction was that Bitcoin could fall as low as $15,000. This assumes that consumer inflation will rise to 9% next month. However, as crude oil prices fall, it’s possible that U.S.
consumer inflation won’t rise much higher than last month.
There is a high degree of correlation between the prices of crude oil and Bitcoin. Crude oil prices started to rise on December 20, 2021. Between December 20, 2021 and today, Brent crude oil has risen by 61% and BTC has fallen by 58%. In many ways, Bitcoin and crude oil prices mirror each other and move in opposite directions.
Other data supports the hypothesis that BTC reached its low last week.
Will Bitcoin go up?
Bitcoin is increasingly likely to rise again in 2022. However, the pace of ascent is questionable.
- Two weeks ago, the Fed raised interest rates by 0.75% with the promise of more to come. Inflation is expected to start falling over the next 2-3 months in response to repeated Fed rate hikes (later). This should increase investor confidence.
- BTC at $21,000 is only 30% of last year’s. This would be a fantastic opportunity for those who invest over a period of 3-5 years. After all, BTC has only had 2 bad years in the last 10.
- With a market cap of less than a trillion, Bitcoin makes up for almost nothing in the global investment portfolio. So the opportunity is immense.
However, some experts disagree
- Peter Schiff says BTC will go to $12,000
- Goldman Sachs made a sale on Coinbase suggesting that cryptocurrency prices will not recover quickly
- JP Morgan says miners are struggling suggesting growing problems for the industry
When will Bitcoin return?
There are two macro datasets that could indicate that Bitcoin will come back
- Inflation data to be released on July 13 should show improvement
- Before then, any move in crude oil prices drops to $100.
The question is when US inflation is expected to fall?
- The OECD expects inflation (17 rich countries) to peak during the summer of 2022 and then fall.
- Kiplinger also says inflation will peak in the summer and then thin out.
We know that crude oil prices are also expected to fall in the 3rd or 4th quarter this year according to the EIA of the U.S. Energy Agency.
So it can be said from the information we have that Bitcoin prices are likely to rise again from September to October of this year.
Under what conditions could these predictions be wrong? Unpredictable turn linked to the Russian invasion of Ukraine, the new geopolitical crisis not seen at the moment, the new problems related to the food supply chain, the unpredictable weather conditions affecting the food supply, the political stalemate or the spectacle in the United States due to the November elections.