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Debashree Patra
Debashree Patra
Author
- Jul 11, 2024 05:50 UTC
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Crypto Market Today: Why Ethereum and Solana Are Must-Buys in This Dip
Bitcoin and Ethereum prices dropped significantly. This is likely a temporary correction that will last until September, historically followed by a bull run.
Strong institutions are buying, and Ethereum and Solana are good assets to accumulate for the long term.
Focus on established sectors and proven performers.
Bitcoin and Ethereum have recently faced significant price drops, sparking widespread concern among investors. Bitcoin’s fall below $55,000 has triggered major trading signals, breaking the short-term uptrend established since last August. Historically, similar corrections have lasted over two months before the bull run resumes.
Crypto analyst VirtualBacon highlights that the recent market dip isn’t just due to Germany selling 27,000 Bitcoins. It’s also intertwined with broader issues like rate hikes, presidential election results, SEC decisions, and ETF inflows. External factors, such as Mt. Gox’s potential sale of 142,000 Bitcoins, are adding to market pressures.
Despite the alarming drop, he advises against knee-jerk reactions.
Institutions are Buying the Dip!
Despite the decline, major institutions such as BlackRock and Fidelity are buying the dip, signaling strong institutional confidence. The recent correction began on July 4th and is expected to continue until September, aligning with historical mid-cycle corrections that last 60-70 days. Additionally, Bitcoin’s price action often correlates with the NASDAQ and S&P 500, suggesting that as long as these indices rise, Bitcoin will likely follow suit.
Hunting for the Gems
Expanding his horizons, VirtualBacon is scouting altcoins for hidden gems amidst the chaos. He notes that while several altcoins like Solana, Avalanche, and Polygon are expected to see a 10%-20% drawdown, strong assets like Ethereum and Solana remain worthwhile for accumulation.
According to the analyst, both assets are poised for success, with Ethereum benefiting from upcoming ETF launches and Solana showing resilience during recent market turbulence.
Strategic Adjustments for the Future
Investors are advised to focus on proven performers and consider promising sectors like AI, gaming, and meme coins. Due to liquidity issues among many new tokens, these sectors may outperform as older ones lose value. The expert suggests that portfolio adjustments should be made gradually over 2-3 months if considering meme coins or other altcoins.
All Eyes on the Bull Run
The bull run is expected to resume when Bitcoin breaks above the 21-weekly EMA and establishes a higher low. Patience and strategic accumulation of strong assets are recommended during this period. Key price targets include Bitcoin at $50,000, Ethereum between $2,200-$2,600, and Solana at $100-$110.
While the transfer of funds to exchanges suggests Germany may intend to liquidate, it doesn’t confirm that the assets have been sold. Additionally, FTX’s bankruptcy estate is set to distribute about $16 billion in cash to crypto investors around September or October. This distribution is expected to act as a positive catalyst for the market in the coming months.
Bull or Bear? What’s your outlook on the next crypto market cycle?
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