Bitcoin (BTC) failed to clinch $31,000 by the Wall Street open on May 13 as new warnings forecast continuation of downside.
BTC/USD 1-hour candle chart (Bitstamp). Source: TradingView
Dollar declines, stocks bounce at week’s end
Data from Cointelegraph Markets Pro and TradingView showed BTC/USD consolidating after reaching just short of $31,000 earlier on the day.
United States stock markets saw some relief, the S&P 500 up 2.2% and the Nasdaq gaining 3.3% on the open.
The conspicuous exception was Twitter stock, which at the time of writing traded down 7.7% on the day thanks to Elon Musk delaying his takeover bid.
U.S. dollar index (DXY) 1-hour candle chart. Source: TradingView
In parallel to the renewed equities strength came a declining U.S. dollar, with the U.S. dollar index (DXY) coming off fresh twenty-year highs to decline 0.2% — traditionally a boon for Bitcoin and risk assets more broadly.
$DXY – Finally showing some sort of chance for a pullback. This would help #Bitcoin and #Stocks. Still early to tell but it’s better than seeing another green candle. pic.twitter.com/WZ3vSUwZsd
— IncomeSharks (@IncomeSharks) May 13, 2022
As optimism around Bitcoin slowly returned in the midst of the Terra LUNA blowout, some sources still argued that it was far from guaranteed that a deeper BTC price crash would be avoided.
Among them was on-chain analytics platform Material Indicators.
“This BTC rally could continue, but before you FOMO in, ask yourself what has changed fundamentally?” part of its latest Twitter update stated.
“IMO, the macro bottom is not in yet.”
An accompanying order book chart from major exchange Binance showed moderate support in place below spot price, this nonetheless being little in comparison to the main wall at this week’s $24,000 lows.
BTC/USD order book data (Binance). Source: Material Indicators/ Twitter
Equally wary was popular trading account HornHairs, which demanded a reclaim of up to $50,000 on the weekly chart to avoid a capitulation event.
“Until then there is a real chance we could chop around & dead cat bounce here for a few weeks into another flush down to $20k for accumulation bottom,” a recent tweet read.
As Cointelegraph reported, a further theory suggested that to preserve its tradition of 80% drawdowns from all-time highs, BTC/USD would need to dive to just $14,000.
Hayes: I would buy Bitcoin at $20,000, Ethereum at $1,300
As the dust settled on markets this week, another voice reiterated his existing concerns over a fresh meltdown to come.
Related: Canadian Bitcoin ETF adds 6.9K BTC in one day as GBTC discount hits record low
In his latest blog post concerned primarily with the LUNA phenomenon, Arthur Hayes, former CEO of crypto derivatives platform BitMEX, called for $20,000.
“The crypto capital markets must be allowed time to heal after the blood letting concludes. Therefore, it is asinine to attempt to fathom legitimate price targets. But I shall say this– given my macro view about the inevitability of more money being printed, I will close my eyes and trust the Lord,” he wrote.
“Therefore, I am a buyer at Bitcoin $20,000 and Ether $1,300. These levels roughly correspond to the all-time highs of each asset during the 2017/18 bull market.”
Hayes had previously called for $30,000 to hit in June, before this week’s shake-up unfolded. Longer term, however, he had likewise told readers to prepare for an extended period of pain across crypto-assets and stocks alike.
By 2030, he said, Bitcoin should cost “in the millions” of dollars.
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