Grayscale Research suggests that the downside risk to cryptocurrency prices may be more limited than in the past, making it possible for Bitcoin (BTC) to reach an all-time high (ATH) this year.
Cryptocurrency markets are showing signs of recovery, with global market capitalization up 5%, indicating a rise in bullish sentiment.
Bitcoin 2024 ATH – Possibility
Grayscale attributes the recent market crash to weaker-than-expected US employment data for July, but believes Bitcoin could retest its ATH. However, this depends on whether the US economy avoids recession and remains on track for a soft landing.
Grayscale Research expects token prices to rebound, citing reasons for the limited downside risk, including robust net demand from spot Bitcoin and Ethereum ETFs. Other reasons cited include a lack of lending from centralized financial institutions during the cycle and subdued returns in altcoins. The study also cites potential changes in U.S. policy views on the crypto industry.
“If the U.S. economy avoids recession and remains on track for a soft landing, Grayscale Research expects token prices to rebound and Bitcoin to retest its all-time high later this year. However, even in a weaker economic environment, Grayscale Research has reason to believe that downside risk may be more limited than in past downturns,” the study says.
Read more: How to Buy Bitcoin (BTC) and Everything You Need to Know
As the cryptocurrency market continues to show calm and regain optimism, the study highlights factors that will continue to influence market stability. It lists macroeconomic data, corporate earnings, and policy responses from central banks, especially the Federal Reserve.
The researcher’s forecast suggests that Bitcoin’s potential ATH in 2024 depends on a combination of market changes, macroeconomic factors, and investor sentiment. This adds credence to recent predictions by Raoul Pal, a former Goldman Sachs hedge fund manager.
Pal said Bitcoin could rise to an ATH, citing macroeconomic conditions, the US election, and a weak US dollar. Pal said Bitcoin could rise to an ATH, citing macroeconomic conditions, the US election, and a weak US dollar. Henrik Zerberg is another bullish analyst who expects a top to be broken for Bitcoin and US stocks.
Indeed, market sentiment is increasingly tilted in favor of Bitcoin’s rise. Bitcoin ETFs saw $194.6 million in inflows on Thursday, suggesting that Bitcoin’s Monday crash may have been a temporary pullback rather than the start of a new bearish trend. These inflows also point to renewed appetite for Bitcoin and broader exposure to cryptocurrencies.
“The cryptocurrency market is going through turbulent times due to global macroeconomic factors. However, the influx of institutional funds can help stabilize the industry. As uncertainty increases, investors tend to play it safe to prevent large losses, but institutional investors with a long-term strategy like MicroStrategy can help stabilize capital flight,” Jamie Elkaleh, country manager at Bitget, told BeInCrypto.
The Bitcoin daily chart suggests that BTC is poised to continue its rally, although low confidence among bulls, reflected in the Relative Strength Index (RSI) remaining below 50, is a concern. However, strong support around $59,866 could help Bitcoin continue its rally. A daily candle close above the midpoint of the supply zone at $67,000 would set the stage for a retest of the ATH.
Read more: Bitcoin Price Prediction 2024/2025/2030
Conversely, if the RSI continues to fall and the $59,866 support level is broken, Bitcoin could present another buying opportunity lower. A break and close below $55,313 would force Bitcoin to capture liquidity on the sell side.
