Bitcoin and Ethereum prices could go in one of two different directions in the coming days or weeks, according to one expert. Will they experience their biggest price drop this year, or will they rise from here and never return to the lows of summer 2022. Martin Hiesboeck, head of blockchain and research at Uphold’s Krypto, believes the former is more likely. He says it all depends on the changing geopolitical situation between Russia, China and NATO. Both Bitcoin and Ethereum fell earlier in the week as the rest of the global markets fell first on concerns that House Speaker Nancy Pelosi’s visit to Taiwan could escalate tensions between the US and China. Russia has also stepped up its attack on Ukraine and Europe is facing an energy crisis. “The geopolitical situation is dominating the conversation. Continued war means continued inflation,” Hiesboeck said. “At the same time, we have a situation that we have not experienced before: almost full employment, economic expansion, and yet there has been no price increase.” Here are two potential scenarios that could play out for Bitcoin and Ethereum in the near term:
Situation 1: Investors Continue to Be More Comfortable With Riskier Assets
Bitcoin and Ethereum started the week on a slightly weaker note, but there is more momentum behind the digital assets than just a few weeks ago. Bitcoin held steady at $23,000 and ethereum traded above $1,600 on Thursday – both down slightly after finishing the month strong. In July, ethereum rose more than 50% and bitcoin rose 20%, according to data from NextAdvisor. Last week, bitcoin reached almost $25,000 and ethereum surpassed $1,700. That’s a significant increase since just two months ago, when the crypto market crashed and Bitcoin hit a low of $17,500. The two biggest cryptocurrencies have hit price levels in recent days that could push them further, especially since most of the recent bad news has already been priced into the market, according to Marcus Sotiriou, market analyst at digital asset broker GlobalBlock. After the Federal Reserve raised interest rates last week and a report showed US GDP contracted in the second quarter, investors gained more confidence that the Fed may ease tightening if the economy begins to slow. This led to strong growth in stocks and cryptocurrencies, making July the best month for the stock market since November 2020. “The Fed has actually tightened and inflation is still at a 40-year high, so we can’t be confident of a change in the market right now,” Sotiriou said. “But the fact that Jerome Powell is starting to say that rate hikes will have a noticeable effect tells me that we’re in the late stages of this bear market that we’ve been in for almost 8 months.” While we’re still in a bear market, crypto expert and market analyst Wendy O says technical charts show Bitcoin is in an uptrend. It’s a trend with the times. However, he says Bitcoin needs to move above $26,700 to be bullish in the short term. “Can we do it? I don’t know yet, but one thing I’ve noticed in bitcoin is that we hit $24,800 [on July 30] and we had a couple of attempts to go through and flip, but we didn’t,” O said .” “Maybe we’ll try a little harder, but then.
