Bitcoin’s fast recovery from the post-crash price of $11,000 has again been short-lived as a new correction sweeps across the market.
It seems the downward move is not yet over, as analysts on 14 October said they expect the number one digital asset to hit $108,000 before another reasonable bounce.
They however say it is a natural market move with no special cause, so there’s nothing to worry about.
Dusk before dawn
Bitcoin is currently trading at $110,600, below the level from which it recently bounced to $115,000.
According to the current prediction, the coin may drop a couple more thousands before it is ready to recover if it holds that level.
In addition, the analysts seem to believe there is no incentive for Bitcoin to rise until after the expected October Fed rate cut which usually precedes a rally.
This also implies that the rebound may still be delayed if the Fed decides not to cut rates, which will affect the rest of the crypto market as well.
What is driving the correction?
Though analysts say the correction in Bitcoin is a natural and healthy one, it has coincided with some important market activities that cannot be ignored.
For example, Bitcoin ETFs saw outflows of $326 million on Monday alone this week. These outflows could definitely have contributed to causing the correction.
Also based on prevailing sentiment, it is clear that the U.S.- China trade tension that led to the previous flash crash isn’t gone yet, causing some caution among investors, but the fear may reduce in the coming days.
As the dust settles, investors may become more confident and enter the market again, increasing the chance of a rebound but until then, the market remains in the red zone for now.
What do you think?
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