Ethereum & Solana
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.
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.
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.
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.
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