The trend for bitcoin was always bullish and there are no signs of this changing, says one analyst.
The first three months of 2022 can be crucial for the evolution of the price of the cryptocurrency
We all want to have the super power to predict the future, or at least have a kind of crystal ball that allows us to see what will happen. As the reader of this article will surely know, that is not possible. However, you can use reasoning to make certain predictions, at least when it comes to markets.
Technical and fundamental analysis are some applicable strategies to carry out this type of forecasting. Bitcoin, like other assets, is generally subjected to market forces, and that is why many specialists are dedicated to analyzing its movements and predicting the development of the next days, weeks or months.
In order to know a little more about what 2022 can bring us, CriptoNoticias consulted several of them. One of them is @immortalcrypto, a Spanish market analyst who comments on his forecasts in your twitter account, in which he has more than 133,000 followers.
Tenkan, another of those consulted, is an investment advisor with an account on Twitter with more than 24,000 followers and a community on Telegram. Finally, also thinks David Battaglia, youtuber with more than 136,000 subscribers on your channel and another 76,000 people who follow him in Twitter.
“Crypto winter” or bitcoin bull cycle in 2022?
What does bitcoin hold for 2022? Will its price follow the uptrend as in 2021 or, on the contrary, will there be a bear market or “crypto winter” like 2018?
In response to these inquiries, Tenkan opined that he does not believe there is a bear market. “The price has been on the side since March 2021, it has been between USD 63,000 and USD 30,000 for almost a year,” he says, adding that “USD 30,000 today is a great support validated several times. It is to be hoped that this area will not break down ».
Beyond this, there may be fixes, consider. “Every big rise needs a correction, be it sideways or a sharp drop in price. We saw that when we hit $ 20,000 the first time, and then we hit $ 3,200 to get a new boost. “
For its part, David Battaglia predicts a rise in the price of the main cryptocurrency driven by external factors, linked to the world economy. The analyst is based on the world macroeconomic situation, with record levels of debt, and that the FED (United States Federal Reserve) and the other central banks cannot raise interest rates significantly. In this way, he considers that “the bull market will continue due to the loss of purchasing power of fiat money, despite any corrections we may have.”
Far from ‘clear’ market cycles, which ‘most are used to’, @immortalcrypto sees 2022 as a year of consolidation similar to 2021. ‘I see unlikely to have a’ crypto winter ‘and bitcoin breaking below USD 30,000 ” , points, and adds that there is even likely to be a new ATH (All-Time High or all-time high) in late 2022.
What months will be key for bitcoin in 2022?
Now, what months could be crucial for the evolution of the price of bitcoin? Battaglia invites you to pay attention to what happens in the first two months of the year: «January and February are crucial months. If the market does not correct in that time, we will be fine in general terms.
Meanwhile, Tenkan believes that March could be “the one that gives some guideline” in 2022. It is based on the “cycle changes” that have occurred in that month in previous years: “In 2019, it broke USD 4,000 to go directly to the USD 14,000; in March 2020, the drop again to USD 3,800 with the ‘Covid effect’; and in 2021, he made the roofs for the first time at $ 60,000. “
Almost in the same vein as his colleagues, @immortalcrypto believes that the key will be in the spring, which in Spain begins in March. At this time, “the market could have some very good months and go back to the $ 60,000 or $ 70,000 zone,” he says.
What opportunities can drive the price of bitcoin in 2022?
Regardless of the calendar, the price of bitcoin is influenced by context. So it can be helpful to look around and see what factors can help the cryptocurrency lift its value, or affect it lower.
Regarding this issue, David Battaglia thinks that “at the state level we will see more countries entering the bitcoin bandwagon, especially those energy producers in the third world.”
A case like this could be that of Paraguay. As reported by CriptoNoticias, this country is increasingly chosen by miners who seek to take advantage of its cheap electricity.
The Spanish analyst @inmortalcrypto does not advise “anything in particular” that could affect the price of the cryptocurrency. “Months ago we had a very strong euphoria, and since the price refused to go above $ 70,000, the sentiment has changed quite a bit. No matter what news comes out now, market sentiments take time to change, they are cyclical, “he explains.
For Tenkan, “2021 was a great year” and tools such as DeFi (decentralized finance), NFT (non-fungible tokens) and games like Axie Infinity took hold, which “gave a lot of visibility to the ecosystem.”
“I believe that the sustained growth of these and other projects based on blockchain will increase the flow, which will make the ecosystem grow and will boost the prices of projects with good fundamentals,” adds the Argentine.
What risks can cause a fall in the price of bitcoin?
In the markets as in life, “not everything is rosy.” For that also we must consider the possible events that trigger a decline in the price of bitcoin.
The analysts consulted put the magnifying glass on several different aspects. For David Battaglia, over-leverage or a liquidity crisis are risks “in the short term.”
For its part, @immortalcrypto considers that the only thing that could trigger a decline is losing the $ 30,000 level in bitcoin. This fact, which the analyst likens to the drop below USD 6,000 in 2018, could generate “a total capitulation”, with a decrease of more than 50% in the price of bitcoin and many decreases close to 90% in altcoins if this it happens.
However, Tenkan referred mainly to what happens with the global health crisis due to the Covid-19 pandemic: «The new strains of Covid and the closures of countries, which generate fear in the people, can depress prices».
However, he is still optimistic for the future. “While this is a potential contingency, the trend for bitcoin has been bullish since its inception and there seems to be no or no sign that it has ended.” He also adds: “It is important to understand that cryptocurrencies have 90% corrections in price and that does not cause the upward trend to change.”
Will there be dominance of bitcoin or altcoins?
The so-called alt season occurs when the performance of the main alternative cryptocurrencies or altcoins it is better than bitcoin for a specified period. For example, the site Blockchain Center takes into account the 50 most important cryptocurrencies on the market and compares them with bitcoin to calculate the alt season index.
What panorama will 2022 present in this regard? Tenkan expects bitcoin dominance, “which today is at record lows in the 40% area,” to rise this year. “This rally may be fueled by a new bitcoin bull rally.” “It is important to follow this constantly so as not to lose sight of the focus of the ecosystem as a whole,” he says.
David Battaglia thinks similarly. It’s a tough question, but I think bitcoin and altcoins move in cycles where this varies. In my opinion, in the long term Bitcoin will win the battle. So does @immortalcrypto, with bitcoin dominating the scene but with altcoins “having intermittent mini-altseasons lasting 1 or 2 months.”
Changes in Ethereum and their effect on the value of the cryptocurrency
Finally, CriptoNoticias also asked the analysts in question if they think that The move towards Ethereum 2.0 may somehow impact the price of the cryptocurrency. In 2021, ether (ETH) quintupled its market value, as can be seen in the following graph.
On this subject, @immortalcrypto thinks that, Although they are important, these events do not affect the price as much. Ethereum is the home of many brilliant projects, including NFTs. I think it will continue to grow in 2022, although this depends a lot on what bitcoin does, since the correlation between the two has always been strong, “he said.
For his part, Tenkan affirms that, given his way of “analyzing the markets for more than 10 years”, the news “is already in the prices”. In other words, News about Ethereum’s transition to the new 2.0 network will not affect the bull cycle cryptocurrency, which for the analyst has even “greater long-term strength” than bitcoin.
Regarding ether, he adds that “today we are in ETH in a range of lateralization that it is possible to think of it as an accumulation zone to go to new highs.” While clarifying that “the fundamentals of ether are not the same as for bitcoin, the market generally moves in the same direction, all bullish or all bearish.”
Therefore, he says, if there is a new bullish rally of bitcoin, all cryptocurrencies in general will go higher, “With greater or lesser volatility, depending on each one of them.”
So thinks Battaglia, who assured that the price of ether “will continue to rise if bitcoin does.” Regarding their updates, “it seems to me that they are going astray towards greater centralization,” said the trader.