Mike McGlone, senior commodities strategist at Bloomberg Intelligence, who previously said bitcoin could fall to $10,000, reiterates his call that bitcoin could still fall below that level, a prospect several market analysts say would require an extreme macroeconomic shock.
In an interview with EllioTrades, McGlone said the crypto bear market may not be over and warned that bitcoin could remain vulnerable if global risk assets revalue sharply.
McGlone’s predictions were refuted by several market analysts who said that while they agreed on further downside for Bitcoin is possible, a drop to $10,000 would likely require an extraordinary global liquidity event.
“Analysts often get lost in the short-term macroeconomic noise, and sometimes they extrapolate that to come up with silly conclusions,” said Mati Greenspan, founder and CEO of Quantum Economics.
“For an asset like Bitcoin, which regularly sees tens, if not hundreds of billions of dollars of daily trading volume in global markets, to return to $10,000, we would need a global liquidity crisis, nuclear war and the Internet to shut down.”
Bitcoin is currently hovering around $70,000, after trading between $69,000 and $71,000. BTC’s price rally appears to coincide with oil quickly reversing most of its session’s big gains, losing $3 per barrel in a matter of minutes. Other crypto assets including Ether (ETH), Solana (SOL), and XRP have also seen upward movements.
McGlone based his bearish analysis on broader macroeconomic conditions. He believes bitcoin is increasingly trading in tandem with other speculative assets as institutional participation in crypto markets increases, weakening the narrative that crypto serves as an uncorrelated hedge against traditional markets.
According to McGlone, the crypto sector remains trapped in a broader macroeconomic slowdown driven by deflationary pressures, speculative oversupply and what he sees as an unfinished correction in traditional risk markets.
Another disadvantage is still possible
Other analysts, who see potential for further decline in Bitcoin’s price, also echoed Greenspan’s sentiment that McGlone’s price target is unlikely.
“A move towards levels such as $28,000 would likely require a significant contraction in global liquidity, a widening of credit spreads or a broader financial stress event rather than just a late-cycle slowdown,” said Jason Fernandes, co-founder and market analyst at AdLunam.
Jonatan Randin, senior market analyst at PrimeXBT, also said Bitcoin could see further downside, but called the $10,000 prediction highly unlikely.
“There will always be analysts who call for extreme price targets during a bear market,” Randin said. “Can we go down to $10,000? Yes, it’s possible, but I consider it highly unlikely.”
Randin expects bitcoin to gradually decline in the coming months, adding that the next major accumulation zone could emerge between $30,000 and $40,000.
“If the market is in a downtrend, you are in a bear market,” Randin said. “You’re going to stay in a bear market until the main trend changes.”
In the short term, however, he expects bitcoin to remain largely range-bound between $60,000 and $70,000, warning that even a rise toward $80,000 could prove temporary if broader macroeconomic pressures persist.
The bottom may already be in place
Greenspan said it was difficult to pinpoint an exact market bottom, but he noted that bitcoin may have already completed its major bear market correction.
“Trying to determine a precise background is a foolish task,” he said. “Structurally, Bitcoin has already overcome its main bear market in 2022. We are currently looking at a ~50% retracement from the all-time high, which is not unusual for Bitcoin.”
He added that recent price action has been encouraging and that it is “entirely possible that we have already seen the bottom.”
McGlone believes, however, that the market still needs to go through a prolonged cleansing of speculative excesses before a lasting bottom can form.
“I think this is going to go on for a while, and I don’t think it’s going to end until we purge some of these excesses,” he said.
“It’s a bear market,” McGlone added. “Sell rallies. »
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