Famous Researcher Says There Will Be More “Pain” in Bitcoin Price, Shares His Predictions

According to Markus Thielen, a researcher at 10X Research, the world’s largest cryptocurrency Bitcoin It has entered a downward trend since June 20. Thielen laid out ten reasons why Bitcoin price could potentially drop to $55,000 in the near term. He noted that many trend-following funds also observe the same signals and may be tempted to take short positions.

Interestingly, the last presidential debate appeared to favor Donald Trump, who has recently expressed notable support for crypto and Bitcoin. But Thielen suggested that President Biden’s poor performance could increase the chances of a new Democratic candidate who could pose a tougher challenge in the upcoming November election.

Thielen also highlighted the impact of seasonality on Bitcoin’s performance. Historically, the third quarter has been the weakest period, with an average return of just 5% over the past 13 years. This stands in stark contrast to the average returns of over 60% observed in both the second and fourth quarters.

Despite the disappointing price action in Q2, it’s possible to view it as a correction within a larger bullish movement. It’s worth noting that Bitcoin has risen nearly five-fold from its January 2023 lows to reach an all-time high of $73,500 in mid-March of this year.

As the crypto market closes out a lackluster quarter, analysts like Thielen believe there may be more challenges ahead.

Thielen said this as one of the reasons for BTC’s decline:

“Weekly and monthly reversal indicators point to a broader correction. Weekly RSI peaked in early March and has retreated despite Bitcoin remaining above $60,000. Monthly Stochastics are similar to previous multi-month highs from January 2018 and May 2021.

According to our trend model, Bitcoin entered a downtrend on June 20. While not every signal is successful, trend-following funds (CTAs) follow a similar strategy and may pile on short positions. Position sizes may increase, especially with falling or low volatility. Realized volatility is only 30%.”

*This is not investment advice.