Arthur Hayes Predicts Bitcoin Decline and Central Bank Intervention Amid Market Collapse
Arthur Hayes anticipates that Bitcoin may decline to around $70,000, as traditional financial markets experience turmoil. He believes that significant pressure could prompt the Federal Reserve to ease its monetary policies. Careful timing and risk management are recommended for investors navigating this volatile market.
Arthur Hayes, co-founder of BitMEX, suggests that Bitcoin (BTC) could see continued downside movement, even after experiencing a 24% correction from its peak. In his latest commentary on social media platform X, he describes potential scenarios that could compel the Federal Reserve (Fed) to reassess its strict monetary policies.
Hayes predicts that Bitcoin’s decline will coincide with a downturn in the U.S. stock market. However, he believes that these factors alone may not be sufficient to prompt the Fed’s intervention. The failure of major U.S. financial institutions could force the Fed to end its quantitative tightening, which may lead to similar actions from other global central banks.
“BTC likely bottoms around $70,000. A 36% correction from the $110,000 all-time high is very normal for a bull market,” Hayes states. He posits that significant downturns in stock indexes, alongside failures in traditional finance, will trigger a broader easing of monetary policy by the Fed and other prominent banks.
He advises traders to be cautious, noting that while many might rush to buy the dip, risk-averse investors should wait for clear indications of central bank easing before committing additional resources. “You might not catch the bottom but you also won’t have to mentally suffer through a long period of sideways and potentially unrealized losses.”
Hayes emphasizes that Bitcoin may experience considerable price volatility if it approaches his suggested target due to the considerable volume of outstanding derivative contracts in the $70,000 range. He notes, “There are a lot of options OI struck at $70,000-$75,000, if we get into that range it will be violent.” Currently, Bitcoin is trading at $82,780, reflecting an increase of nearly 5% in the past day.
In conclusion, Arthur Hayes foresees potential further declines in Bitcoin prices, suggesting a potential bottom around $70,000. He highlights that significant events in the financial and stock markets may ultimately lead to a shift in monetary policy by central banks. Moreover, he cautions investors to approach this volatility with care and strategic timing to optimize their investment decisions.
Original Source: dailyhodl.com
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