"The Fed bomb could explode." 8 predictions for the bitcoin exchange rate

How U.S. policy will affect the value of the first cryptocurrency, what it will be at the end of 2020 and what are the risks of the second wave of COVID-19

The lull in the crypto market lasts more than two months. The price of bitcoin is tightly bogged down at $9000, and the volatility of the asset has dropped to an annual low. This means that at some point there may be a surge, and the asset rate will either collapse or take off. Eight experts gave a forecast on the value of the coin and answered the main questions: when the flat will end, how low the price of BTC can fall, how high it will rise, and what it will be at the end of this year.

"Bitcoin is not a protective asset"

Vladislav Antonov, an analyst at Alpari

No one knows when the flat will end. Exiting the price from the range for all will be unexpected when the market lulls the vigilance of investors and traders. The prospects for bitcoin for the second half of the year are good. For example, during the second quarter, bitcoin rose by 42.23% against the US dollar - to $9132, for the six months - by 27.41%.

In 2020, the coronavirus strengthened bitcoin's connection to the index of the S'amp;P 500. Now the American stock market sets the direction of cryptocurrency. He lives his life on weekends when all exchanges are closed.

For the currency market, the key driver is the US Federal Reserve's printing press. The Federal Reserve has filled the financial system with dollars and is not going to turn it off. The ECB also poured 1.3 trillion euros under minus 0.5 - minus 1%. The inflow of funds is observed in bonds, in emerging markets, stocks. Maybe some of the funds have reached the crypto market, but it is small and is not able to have a noticeable impact on the dynamics of the bitcoin exchange rate.

Bitcoin fans call it a protective asset against geopolitical risks and inflation. I believe that because of the volatility and lack of regulation, it does not have such a status. However, central bank programs should keep the index of the S'amp;P 500 above 3000. If the world manages to avoid the second wave of the coronavirus pandemic, it will be a signal for a rally of the stock market as well as cryptocurrencies. In this case, the level of $15 thousand. will be targeted. Here I took into account the previous rallies in 2017 and 2019.

If the Fed fails to cope with the protests and stop the spread of the coronavirus, the pressure on the index of the S'amp;P 500 and bitcoin will increase. According to Alpari, the technical picture indicates the market's readiness to reduce BTC to $8300-$8400. If this level does not stand, then for bitcoin the 3rd quarter will be red. A drop in the rate below $8300 will open the way for sellers to $7700.

I think that in the second half of the year the situation on the crypto market will depend directly on the American stock market. From the point of view of technical analysis within a month and above the situation for bitcoin is formed "bullish", so buyers need activity to pass $10,700 as quickly as possible. There, buyers will take control of the market.

"The Fed bomb could explode"

Leading Trader United Traders Alexei Markov

Now cryptocurrencies and especially bitcoin in the long term are held back by the stock market, which is growing abnormally despite the depression in the world economy. The International Labour Organization recently estimated a global reduction in working hours due to the pandemic of 14%, or 400 million jobs. U.S. unemployment rate (13%) may have broken the Great Depression record, and although it has now fallen, it is still above 10%, which is three times more than before the pandemic.

Although the spread of the pandemic as a whole has been contained, it is too early to say whether the pandemic has been defeated. Yesterday, the national quarantine was again announced in Kazakhstan, i.e. outbreaks are repeated. Scientists have not yet come to a conclusion as to whether the virus mutated or whether the new strains are dangerous. If so, even if they start distributing a working vaccine, it is not a fact that it will get rid of the virus. In the long term, this means new quarantines and shocks in the world economy.

Despite this picture, the stock market is growing rapidly due to the largest stimulus program in history. The Federal Reserve has become the main "bull" on the stock market. Now this policy fulfills its task - saves from defaults, that is, from market collapses. But, on the other hand, the total debt on dollar liabilities exceeds more than 10 times even the super-ambitious program of the Fed. No one knows what the continuation of the printing press will lead to. In my opinion, it is similar to the treatment of flu antipyretic. That is, only symptoms are treated. Previously, the crisis served as a cleansing of bad debt, financially insolvent companies. Now the "zombie economy" is growing - the share of companies that live only at the expense of credit instruments. Sooner or later this bomb will explode, and then the fall may be deeper than without such a policy.

What about cryptocurrencies? Now their correlation with the stock market has increased again. This is always the case at the bullish stage, but this correlation is short-term. We saw what this leads to in March. Large investors understand that the "bomb" of the Fed can explode, so quietly invest small (in their portfolios) parts in bitcoin, which does not depend on the policy of the Fed. As the stock market grows, it will restrain the growth of the prices of bitcoin and gold, but if and as soon as there is a negative effect of "quantitative easing" or there will be a new round of the pandemic, the situation will change. The worse the situation in the economy and the stock market, the more investors will go into bitcoin, the higher its price will be. The space for scaling is huge: in a new report released recently, the target market for BTC was estimated at $212 trillion. I agree with these assessments. Taking into account the constant offer, its price can grow many times, if not tenfold. But to do that, the stock market must return to the real world.

"By the end of the year, the price of bitcoin could reach $14,000-16,000"

Senior analyst BestChange.ru Nikita zuborev

If there are no strong shocks in the market, another one or two months may continue flat, but then we expect the beginning of the phase of stable growth. We see that there is a gradual recognition of bitcoin in society, and this factor contributes to the price growth in the long term, but should be reflected in the near future, thanks to the strengthening due to halving.

The price may start to rise as early as August, and by the end of the year can reach the level of $14,000-16,000. But despite the positive expectations, before the start of the new rally there is a risk of falling below $7000 in the coming weeks. Given the positive expectations of the market, the current price remains comfortable to buy, especially if there is a short-term price reduction.

"It is unlikely that the bitcoin rate will fall below $8000"

Private trader Alexander Boyarintsev

The bitcoin volatility index has fallen to its lowest level in recent months, and its price is in the range of $8500-10,000. Judging by the schedule, this can last until the end of the summer, usually due to the holiday season: people trade less and sit at the computer screens. Personally my opinion, the below $8000 price is unlikely to fall and I will be purchased from these levels.

The scenario of a sharp fall in the current configuration is unlikely because the economic crisis is not over yet. Despite the fact that the markets are now euphoric, and everyone thinks that everything will be fine, I am sure that it is not. Bitcoin, like gold will grow, it has shown all the properties of gold and has proven itself as a protective rare asset.

In autumn, if the price passes the level above $10,000, it is likely that the next level will be $12,000. I expect that by the end of the year, it is quite possible that we will see a price of $15,000-16,000. It all depends on the economy and uncertainty in the world, and it will grow, unequivocally.

"In the autumn, bitcoin is waiting for a significant price movement"

Victor Pershikov, Lead Analyst at 8848 Invest

At the moment, the BTC rate is sandwiched in the range of $9000-$10,500 and, with local breakdowns of the limits of this flat, the current lateral dynamics will continue until August-September 2020. A significant movement in the price of bitcoin is expected in the autumn for three reasons.

First, based on the historical behavior of the cryptocurrency exchange rate after halving, BTC played out half the reward for the extraction of the block within 3-6 months after the event. Halving, held in May this year, will be implemented by the increase in the price of BTC within September, the reason for which will also be a systematic increase in the volume of Bitcoin trading against the background of the arrival of institutional participants in the market.

Secondly, the high risks of the second wave of COVID-19 in autumn can also affect the BTC rate. Despite the downside risks of classic markets, in my opinion Bitcoin will benefit from a possible second wave, because, unlike the stock and commodity markets, the price of bitcoin still has a significant reserve of momentum, while the world's leading stock markets have recovered to date much more significantly than digital assets.

Thirdly, political tensions in China are an important agenda, given the mainland's growing influence on Hong Kong's political life. As you know, a significant number of mining and blockchain companies are concentrated around Hong Kong, and, against the background of China's growing influence on the internal processes of the region, the cryptocurrency can be in high demand from local investors.

I expect BTC to rise to $14,000 in the third to 4th quarter of this year, as well as the rise in the most capitalized altcoins of the crypto market.

"Loss of confidence in the dollar will lead to the flow of capital into cryptocurrencies"

EXANTE Managing Partner Alexei Kirienko

The flat is likely to last until September, as it has been more than once. In the autumn, the volatility will return to most markets, and the cryptocurrency market will not avoid it. Bitcoin will grow due to the fundamental reasons of the imbalance of supply and demand in the conditions of uncertainty in traditional financial markets, as well as the continuation of monetary expansion by the Central Bank of developed countries.

Another likely growth factor is the hope of some investors for a repeat of the hype of 2013 and 2017, which followed previous halvings. Do not forget about the arrival of new entrants to the market, the number of which until recently doubled once a year and on average led to a proportional increase in market capitalization.

Active growth can occur if the dollar shows a significant increase in inflation. This is a new factor that has not existed in previous years. Loss of confidence in the dollar can cause the flow of capital into cryptocurrencies, whose inflation is algorithmically limited.

"Cryptocurrencies will become an alternative source of investment"

Oleg Abelev, expert of the investment movement "Lemon for Tea"

The flat will end when the story of the second wave of the pandemic in the world, according to traditional financial instruments, will be clear. If the second wave starts, we will see quite strong growth in bitcoin and on major cryptocurrencies. They will become an alternative source of investment. This was also the case at the beginning of the first wave of the pandemic.

If there is no second wave, I think the bitcoin rate will not fall much. The range of $8500-9000 in the current market situation - this is fair to us can expect. However, in the case of the second wave, it is possible that the price of the first cryptocurrency will reach $10,000.

How high can the value of bitcoin grow in the second half of the year? It all depends on whether the demand for basic goods and services from the world's population will open up. Including banking services, because if we are talking about the cryptocurrency market as an alternative source of investment, then at a time when all the Central Banks are reducing their key rates, keeping money on bank deposits is less and less profitable, as long as this niche is filled by financial markets. But as soon as the second wave of the pandemic starts, and this niche will not be filled. That's when cryptocurrencies will come to the fore. In this case, at the end of the year we will see bitcoin in the region of $10,000-10 200.

"I wouldn't be surprised if the bitcoin rate goes to $6000"

Trader and founder of Tradunity Dmitry Lavrov

For almost 2 months the price of bitcoin has been in the range of $10,000-9000. We can say that the market is consolidating, and we should expect the continuation of the uptrend. But at the same time, there are certain doubts. What if buyers can't get past the $10,000 threshold? At the moment we do not see active buyers and there are no particularly good reasons why they should appear. I won't be surprised if the price breaks $9000 and we'll see a move down to $6000.

As for the upward movement, if the price is successful and the price is returned to the level of $10,000, the nearest targets should be $12,000 and $14,000. It is difficult to predict what the price will be at the end of this year. This will depend on the direction of withdrawal from consolidation.