- Robert Sluymer from Fundstrat thinks the market has room to fall.
- The critical support lies with $3,100.
At the time of writing, BTC/USD is attempting to break above $3,400 amid strong growth on the cryptocurrency market. The total capitalization of all digital assets in circulation spiked to $114B from $111B during Asian hours. BTC/USD has gained 1% in recent 24 hours.
However, the altcoins are more responsive to the upside momentum. Thus, Litecoin is 13% higher from this time on Thursday. Ethereum and EOS gauged 3%.
Cryptocurrency market has not bottomed out yet, according to Robert Sluymer, strategist from Fundstrat Global Advisors. Bitcoin and other digital currencies are about to retest previous year lows, driven down by bearish technical indicators.
“The price structure for most cryptocurrencies remains weak and appears vulnerable to a pending breakdown to lower lows,” Sluymer wrote in a note to clients.
Digital currencies have had a tough time over the past year with Bitcoin, the most well-known of the lot, down more than 80 percent from its December 2017 high. In a recent report, JPMorgan Chase & Co. estimated the cost to create one Bitcoin was $4,060 globally in the fourth quarter, higher than the $3,369 level it was trading in Asia on Thursday.
Fundstrat is a well-known Bitcoin bull. The founder of the company Tom Lee said that the cryptocurrency would hit $125,000 by 2022. That forecast was made in January 2018. More recently he predicted that BTC would set a new all-time high within five months.
While Fundstrat experts refrain from giving price targets and timeframes, Sluymer said that investors should be extra careful on approach to $3,100. Once it is broken, the sell-off is likely to continue towards $2,270.
BTC/USD, 4-hour chart