Bitcoin continues to frustrate investors with further churning in a relatively tight consolidation zone. We have been trading sideways for the past month, but in time should see higher prices. Proprietary indicators warn of a potential retest or break of May’s lows during July/August. However, we should see a break over $32,000 during the summer, which will have bullish results for the entire crypto market.
Once we see a break above $32,000, price should quickly test $34,000. During this move, altcoins are likely see a strong rebound with the potential of rising 10% to 20%. Even though markets are in pain right now because of a high CPI report, this poor monetary data will in time should help risk assets such as cryptocurrencies. Capital will start rotating away from the dollar and treasuries into assets such as stocks, commodities, and crypto.
In the short term, there will continue to be some exciting news for the overall crypto space. The development and innovation in the space is growing to new heights, and there is much to be excited about on the horizon. Right now in Austin, Texas, one of the largest crypto events of the year, Consensus 2022, is presently taking place. With high profile attendees such as Elon Musk, Sam Bankman-Fried, members of congress and web 2.0 executives, there will certainly be a number of positive headlines. If we see a formal date for the launch of Ethereum 2.0 or another major news headline, expect sentiment in the crypto industry to shift drastically.
We believe that the advent of digital assets will play out similar to the dot-com bubble. Right now we are starting to get to the point where the early majority enters the crypto space. This increase in liquidity will allow for crypto’s market cap to reach several trillion, and will mark a new era of speculation. Even though there will be very few networks that survive in the longterm, cryptocurrencies make for excellent trading vehicles. And for long term holders, we cannot overemphasize our model portfolio which contains a list of tokens that should withstand the test of time. Nonetheless, diversifying is important as anything can happen with any project. Nothing is ever truly guaranteed – beyond death and taxes, of course.