On the 4H chart, technical indicators are showing a clear-cut trend. At the weekend, I mentioned that the nearest downward target levels were located at $34,267 and $29,750. Bitcoin broke through these levels quite quickly. Currently, the virtual asset is trading below the second target level. BTC is expected to reach $24,350. There were no signs that large and institutional investors could resume purchases around the level of $30,000. Bitcoin is completing its uptrend according to the scenario. I have written about it more than once in recent months. I also said that if a drop to $30,000 or lower occurred in December or January, it would be a signal that bitcoin may touch this level within a few weeks. As a result, it took about 5 months for BTC to resume the downtrend. Currently, the entire crypto market is extending losses with bitcoin dragging down all cryptocurrencies.
Bitcoin has never been a hedge against inflation. It is a high-risk instrument.
Last year when inflation in the US has just started to accelerate analysts believed that bitcoin could be a hedge against inflation. I took this statement with a pinch of salt. It is impossible to call an instrument that can rise or fall in price by 10-15% during the day a hedge against inflation. However, at that time bitcoin was still growing, hovering at its highs. Therefore, many investors yielded high profits. They could use cryptocurrencies to avoid losses in case of a drop in the US dollar. At that moment, inflation was rising at a slower pace. If bitcoin is falling and does not bring profit to investors, it can hardly be called a hedge. From my point of view, bitcoin is a highly volatile and high-risk investment instrument, as well as an anonymous means of payment. Now, BTC is trading with a bearish bias as the downtrend prevails. I believe that bitcoin may fall to $6,000-10,000 per coin in a year or two, its pre-pandemic levels. The Fed's hawkish stance on monetary policy will only increase pressure on risky assets. BTC can be called for sure one of the most volatile and high-risk instruments.
On the 4H chart, BTC is trading below $29,750. It may soon decline to the target level of $24,350. This level is quite formal as bitcoin has recently entered the range of $10,000 - $30,000. No significant levels have been formed so far within it. Currently, it is recommended to open short positions on BTC.
