With the ongoing market volatility, lead insights analyst Will Clemente has noted that Bitcoin will likely reverse further in the coming weeks despite making attempts to stabilise above $20,000.
Through a tweet posted on June 22, Clemente noted that Bitcoin is in line for a ‘mean reversion’ based on the asset’s recent price movement that dipped by over 60% from its all-time high.
According to the analyst, Bitcoin only managed to sustain gains above $20,000, mainly due to forced selling pressure that won’t sustain above the level.
“After reaching lows across the board of historical valuation plus deviations from 200-day trend 4-year trend etc, forced selling/liquidations and pop back up to $20K, I think BTC is likely set up for some mean reversion over the coming weeks,” said Clemente.
Where is Bitcoin heading next?
After plunging below $20,000, several market analysts have differed on the next course of action, with a section maintaining that the level is the bottom before a rebound.
Elsewhere, prominent crypto analyst Rekt Capital believes that Bitcoin is yet to hit its bottom, especially by reviewing previous sell volumes.
Through a tweet on June 22, Rekt noted that although the cryptocurrency is trading below the 200-week moving average, the previous bear bottom was characterised by high sell volume accompanied by above-average buy volume. However, the analysts pointed out this is not the case in the current market condition.
“Previous BTC bear market bottoms at the 200-week MA would first form on extreme sell volume followed by above-average buy volume in the week after. While $BTC saw extreme sell volume last week, this week’s volume is drastically under-average & seller-dominated,” the analyst said.
Amid the uncertainty around Bitcoin’s next price action, the asset is likely to react to the next move by the Federal Reserve in taming inflation.
This is after Fed chair Jerome Powell appeared before the Congress on June 22, noting that the institution will likely keep raising interests depending on the general outlook of the economy.
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