Closely followed analyst Nicholas Merten says the bitcoin (BTC) and cryptocurrency markets are still at the beginning of a long downtrend.
In a new strategy session, the DataDash host tells his 515,000 YouTube subscribers that other markets are already beginning to signal that an unfavorable macroeconomic environment is unfolding, which will inherently affect digital assets.
Commodities started to rise, the dollar index started to rise, and on top of that, the bond market started pricing in continued increases in the Fed funds rate. The stock markets lived in a fairy tale, and in fact, the markets are not ready to support a bull market due to the rate of inflation.
While a short-term bounce for Bitcoin and possibly Ethereum (ETH) could emerge, Merten says the high prices we saw earlier this month will turn into resistance that will push BTC and ETH lower.
“I wouldn’t be surprised if maybe in the short term we get a bounce here in the 4-hour time frames for Bitcoin and Ethereum to see if we can get back above [$24,000] Instead, start using these bands as resistance.
We have to keep in mind that we might get a short term bounce here from this range, but I don’t think you will come back to that range. I don’t think it will be better than it has been over the past few weeks until much longer and more negative corrections.
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