Bitcoin and Ethereum are still going through a correction, which could take quite a long time. Over the past month and a half, Ethereum and Bitcoin have managed a modest recovery, but there are still no signs that the downtrend that began last year has ended. The fundamental backdrop remains weak for the crypto market, primarily expressed in low spot demand, capital flowing into the artificial intelligence sector, and the Fed's commitment to bringing inflation to 2%, which implies at least a continued tight monetary policy. Thus, we still see no reasons for a sustained rally in Bitcoin and Ethereum.
Meanwhile, head of the World Gold Council David Tait said that Bitcoin will inevitably crash and its value will fall to zero. Notably, Mr. Tait did not substantiate his forecast, calling it "a trader's instinct." The expert thinks Bitcoin has not become "digital gold," a "safe haven," or an "inflation hedge." According to him, even gold cannot guarantee a profit on every trade, as it is also subject to market cycles that change over time. Bitcoin, he said, is and is perceived by the market as a risky asset, which makes it much less attractive to investors than gold. Importantly, crypto optimists continue to emphasize Bitcoin's limited supply, its independence from governments and central banks, and the ease of transfers, arguing that precisely these factors will ensure its long-term growth.
Mr. Tait also said that gold and Bitcoin are two completely different assets that do not correlate with each other. Bitcoin is a young asset, prone to large swings and very sensitive to changes in interest rates or liquidity flows. The head of the World Gold Council does not prohibit investments in Bitcoin and explains that his view on Bitcoin is his personal opinion, not that of the entire Council. Tait also said that stablecoins are much more attractive to him than Bitcoin. Stablecoins offer price stability and are backed by real assets or the dollar. At the same time, their convenience for transfers is no worse than Bitcoin's. Even fiat money, in Tait's view, is much more convenient and practical than Bitcoin, since ultimately it offers its holders price stability — something Bitcoin cannot provide.
Bitcoin continues to form a full-fledged downtrend. We continue to expect a decline targeting $57,500 (the 61.8% Fibonacci level of the three?year uptrend), although this level has essentially already been worked off. We do not believe the downtrend is over. The last bearish FVG pattern was formed in the $68,000–70,700 area on the daily timeframe, so this area serves as a POI for short positions in the coming weeks. On the 4?hour timeframe, Bitcoin is again biased toward a fall, but movements will most likely remain choppy and swing-like. Traders can consider trades from local patterns, but we would not expect strong moves right now.
On the daily timeframe, the downtrend that began in August last year continues. The key sell pattern remains the bearish order-block on the weekly timeframe. We do not believe the current downtrend is over, as there are no signs of its completion for either Bitcoin or Ethereum. Currently, the second leg of the correction continues, which recently transformed into a flat. In a flat market, you can only trade from its borders; the subsequent direction will be determined after the flat ends. Near the upper boundary of the sideways channel ($1,800–1,942), no deviation or pattern was formed, so there are no trading signals at this time. Ethereum is positioned exactly in the middle of the channel.
Comments on the chartsCHOCH is a change of character / break of the trend structure. Liquidity means traders' Stop?Losses that market?makers use to build their positions. FVG is Fair Value Gap (area of price inefficiency). The price often moves quickly through such areas, indicating the absence of one side in the market. Later, the price tends to return and react to these zones. IFVG stands for Inverted Fair Value Gap. After a return to such a zone, the price does not react but impulsively breaks through and then tests it from the other side.
OB means Order Block. A candle on which a market?maker opened a position in order to harvest liquidity and then form their own position in the opposite direction.