Bitcoin price stabilises at $30,000 but recession fears could trigger another sell-off
Economists expect many major countries to face a recession by 2023, potentially causing the crypto economy to slide as well.
- Bitcoin's (BTC) 12-month losses hover around -41%.
- BTC could witness a relief rally of 30–40% if it breaks its AUD$31,700 (US$21,600) resistance cleanly.
- CNBC's Jim Cramer referred to Bitcoin as worthless once again, claiming that more crashes are imminent in the digital currency's future.
Bitcoin has stayed range-bound between AUD$28,500 and $30,000 (US$19,500–$20,500) over the last 7 days. The digital currency is currently down -30% for the month while trading at AUD$29,375 (US$19,968).
On 5 July, Bitcoin experienced an intraday swing of approximately -8% before recovering almost in full. This volatility comes amid rising concerns of a looming recession hitting the American economy in the near term.
Brokerage firm Nomura's chief economist Rob Subbaraman expects a recession to also plague many countries within Europe, as well as the UK, Japan, South Korea, Australia and Canada by next year, adding:
"Right now, many central banks have shifted to a single mandate — that's to get inflation down. So they're going to be very aggressive and that means front-loading rate hikes. We have been pointing out for several months the risks of a recession and we've bitten the bullet. And now we have many of the developed economies actually falling into recession."
Crypto expert Michaël van de Poppe noted that for Bitcoin to surge, it needs to crack the all-important AUD$29,000 (US$19,700) resistance cleanly. If this is the case, he sees a target of AUD$30,000 (US$20,300) in play. "I'm expecting Bitcoin to consolidate for a bit here, but breaking the next resistance zone is a trigger for continuation towards AUD$33,800 (US$23,000) and a summer relief rally," he pointed out.
Some analysts believe that whales have pumped Bitcoin's value "falsely" over the last couple of weeks and a possible pullback to AUD$23,200–$23,800 (US$15,800–$16,200) could happen.
Lastly, technical traders see a 30–40% relief rally on the horizon if BTC reclaims the AUD$31,700 (US$21,600) resistance.
Mainstream media bashes crypto
Amid growing volatility and falling prices, many mainstream pundits have once again claimed that "crypto has no real value" and that the space will die a slow death. CNBC's Jim Cramer sees the market eroding further, going as far as saying:
"Crypto really does seem to be imploding. Went from US$3 trillion to US$1 trillion. Why should it stop at US$1 trillion? There's no real value there. What an awful asset. NFTs sold to you. Made up."
Cramer's insights regarding the crypto market have been hilariously wrong since 2020. For example, in August 2021 he recommended that people buy Coinbase stock COIN when it was trading at AUD$364 (US$248), calling it a steal. At press time, COIN is trading at AUD$79.4 (US$54).
Disclosure: The author owns a range of cryptocurrencies at the time of writing.
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