Glassnode Analysts Predict Bitcoin Correction and Set Price Target
The founders of analytics firm Glassnode are predicting a significant correction for Bitcoin (BTC) following its recent surge. They believe that the cryptocurrency’s price and sentiment have become overheated, indicating the potential for a five-wave correction to lower prices.
Glassnode co-founders Jan Happel and Yann Allemann, known as Negentropic on social media, have identified the $58,000 level as a potential support level before BTC can continue its upward trajectory in the long-term.
Bitcoin’s Rally and the Need for a Correction
- BTC has experienced an impressive rally, rising from $38,000 in late January to $72,000 in early March.
- However, no asset rallies in a straight line, including BTC.
- Glassnode analysts observe negative divergence, as BTC has rallied into its highs in a 3-wave structure (a B-wave).
- Sentiment is hot at $89,000, indicating the need for a cooling-off period.
- Based on these observations, Glassnode predicts that BTC will drop to around $58,000-$59,000 in its next move.
- However, they emphasize that the top is not yet in and BTC will likely continue its bull market after the correction.
Divergence between Bitcoin’s RSI and Price Trend
The Glassnode founders also point out a divergence between Bitcoin’s relative strength index (RSI), a momentum indicator, and its upward price trend. Traditionally, when RSI trends in the opposite direction of price, it suggests a potential reversal.
An Alternative View on Bitcoin Correction
Not all analysts share Glassnode’s belief that a Bitcoin correction is imminent. Economist Alex Krüger, for example, predicts that BTC will reach around $85,000 before experiencing a dip to the $55,000 range. He believes that Bitcoin is in a supercycle with shorter and shallower dips and that macro factors and ETF inflows can sustain and drive prices higher.
Bitcoin’s Current Price
As of now, BTC is trading at $72,876.
Hot Take: Will Bitcoin Correct or Continue Its Rally?
While some analysts are predicting a correction for Bitcoin due to its overextended move to the upside, others believe that the cryptocurrency will continue its rally. Both Glassnode and economist Alex Krüger have different views on when and how much BTC will correct. Ultimately, the future price movement of Bitcoin remains uncertain and will depend on various factors such as market sentiment, investor demand, and macroeconomic conditions.
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