Crypto Analyst Nicholas Merten Warns of Potential Bitcoin Plunge
Crypto analyst Nicholas Merten is cautioning that Bitcoin could experience a significant decline if the economy enters a recession. Merten believes that if commodities such as oil, natural gas, and uranium start to cool down, it may indicate an upcoming short-term recession.
Merten predicts that during a short-term recession, equities could drop to their previous lows, and Bitcoin could follow suit, potentially falling to the $15,000 to $17,000 range. He suggests that this scenario could create a double bottom across various assets.
According to Merten, Bitcoin will not enter a sustained bull market until the Federal Reserve increases liquidity in the markets to support the economy. He notes that there are currently no significant bullish trends in Bitcoin and advises a conservative approach while waiting for signs of increased liquidity and optimism.
The Importance of Liquidity for Bitcoin
Merten emphasizes that Bitcoin thrives when there is an increase in the money supply and a risk-on mentality. However, these conditions are currently absent from the market. He highlights the need for patience and the importance of liquidity as it serves as the lifeblood for risk-on assets like Bitcoin.
Bitcoin’s Current Price and Trading Performance
As of now, Bitcoin is trading at $27,912, reflecting a 1.8% increase in the last 24 hours.
Hot Take: Potential Plunge Ahead
Crypto analyst Nicholas Merten warns that if a recession occurs and commodities cool down, Bitcoin could experience a significant decline of nearly 50%. He suggests that equities may drop to their previous lows while Bitcoin could fall to the $15,000 to $17,000 range. Merten believes that Bitcoin’s sustained bull market will only begin once the Federal Reserve increases liquidity in the markets. Currently, there are no significant bullish trends in Bitcoin, and Merten advises a conservative approach while waiting for signs of increased liquidity and optimism.
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