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Bitcoin Price Will Crash, Says Quantum Hedge Fund Analysts



  • Bitcoin has a likelihood of crashing towards $6,000 in the coming months, according to the Quantum Hedge Fund.
  • The firm pointed to a fractal that sees the cryptocurrency breaking lower after entering the $12,500-$17,000 range.
  • Meanwhile, strong fundamentals see a bullish picture for Bitcoin.

Bitcoin has some fuel left to continue its price rally towards $12,500-$17,000. But after that, a crash is incoming.

So said analysts at Hong Kong-based Quantum Hedge Fund in their alert published Saturday. The team noted an inherent stretch in Bitcoin’s running uptrend – and how every time it leads to a giant corrective move to the downside. That brought them to $12,500, a level the cryptocurrency could hit in the coming session, only to fall back afterward.

“The price can reach the level of 12500, after which we expect a fast price decline in the impulse wave of the oldest correction model,” said the team led by strategist Jan Janssen. “We recommend looking [at] levels for a short sale and forgetting about continued growth in the medium term.”

Anatomy of an Analysis

In retrospect, the “oldest correction model” that Quntuam referred to pointed to an ascending channel pattern. The hedge fund briefed it via a chart, as shown below.

bitcoin, ethereum, btcusd, ethusd, cryptocurrency

Bitcoin and Ethereum risk correction while trading inside a bearish continuation pattern. Source:

The image represented Bitcoin, as well as Ethereum, pursuing a downside continuation trend.

Before forming the ascending channel pattern, they were falling. Their technical description pointed to two different outcomes: reversal or extension. That said, Bitcoin could either bounce back to negate the downside continuation trend or continue targeting lower levels to strengthen its bearish bias.

Quantum noted that the latter would happen. Its chart above projected that Bitcoin would surge towards $12,500–or even $17,000– but would eventually give up its gains to test the lower trendline of the ascending channel. Should it happen, the price will fall towards the level anointed as ‘D.’ That is below $5,000.

“We believe that the mid-term dynamics of ETH and BTC prices will be a big disappointment for many people in the next 2-4 months,” the Quantum team said.

The firm further confirmed that it is already liquidating their holdings for USDT at the current price levels.

“Currently, more than 60% of the volume has been sold at current prices,” it wrote. “The remaining volume will be realized after confirmation of the medium-term bearish pattern, or at logarithmic levels: for ETHUSD 470-730; for BTC 12500-17300.”

Contrarian Bitcoin Predictions

Other Bitcoin prediction appeared contradictory to the one Quantum shared. They focused on the plethora of macro fundamentals that envisioned a higher demand for Bitcoin in the future.

Inflation worries led by the US Federal Reserve’s open-ended bond-buying program, coupled with near-zero interest rates, have made US Treasuries–the safest hedging instrument– more expensive. Yields on the benchmark 10-year US bond dipped is near 0.5 percent. Meanwhile, inflation-adjusted Real Yields fell to minus 1 percent.

The lack of attractive returns prompted investors to look into riskier assets. As a result, the Wall Street indexes trended higher during the second and third quarter despite a concerning economic outlook. Meanwhile, the next-best safe-haven, gold, established its lifetime high at $2,075 an ounce.

bitcoin, cryptocurrency, btcusd, xbtusd, btcusdt, crypto

Bitcoin, Gold, and US Dollar Index performance in 2020. Source:

Bitcoin also surged higher on speculations of becoming “digital gold.” The cryptocurrency logged its yearly top above $12,000 last week on rising demand. Jack Dorsey’s Square reported 600 percent YoY in revenue. It sold a total of $875 million via its CashApp, about six times higher the amount in the same period in 2019.

Marty Bent, the editor-in-chief of Bitcoin-focused daily newsletter, Marty’s Bent, noted that the fall in the US dollar index (DXY) pushed investors into the crypto market.

“The DXY is cratering,” he said. “Bitcoin, gold, and stocks are rocketing. Corporations are diversifying away from cash and into bitcoin and gold. CashApp just had a breathtaking quarter of bitcoin sales.”



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BTC Analysts Believe A Short-Term Upside Is Possible: Opinion




BTC Analysts believe that a short-term upside for the number one cryptocurrency is possible as it consolidated around $10,700. The coin surged higher along with a positive open in the legacy markets and the price of the coin is now hovering above $10,900 which is the highest one in a week as we reported in the bitcoin price news earlier.

BTC Analysts believe that Bitcoin could have some more room to grow to the upside as it recaptures resistances in the $10,000 region. During the move higher, millions were liquidated across margin platforms which suggests that there are traders that are in a good position before the open of legacy markets. Analysts believe that Bitcoin will extend higher in the close term. One analyst even shared a chart below showing the importance of the ongoing move higher.

Bitcoin is breaking higher now as the charts suggest which means that it will soon go to test the resistance levels of $11,200 and $11,400 where the cryptocurrency crashed a few times during the bearish retracements in August. The chart noted that after the rally towards this level it could return to levels of $10,600 which is in line with the sentiment shared by other analysts that BTC is in a period of a market cycle where it will consolidate more for weeks instead of establishing a firm direction. Bitcoin’s medium-term however could be bleak.


btc chart
Chart of BTC’s price action over the past few weeks with analysis by crypto trader Inmortal Technique. Chart from

Josh Olszewicz, an analyst at Brave New Coin, reported that the weekly MACD for the number cryptocurrency is red for the first time since April which only suggests that the medium-term sentiment could be bearish despite the recent price action to the upside. The correction in the medium-term will alight with the normal uncertainty that markets see in a time of presidential elections along with the seasonal weakness that is usually seen in November and October.

Bitcoin stayed above the $10,000 as we reported a day ago in our Bitcoin news, that support and started a decent recovery wave but the price is trading still above the $10,550 resistance and the 100 simple moving average. There was also a key bearish trend line broken with the resistance at $10,600 on the 4-hour charts of the pair. The pair will likely continue higher if there’s a clear break above $10,800. Over the past week, BTC found support above the $10,100 level against the US dollar and remained well bid above the $10,200 level when it started a steady recovery wave.

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Bitwise Bitcoin Fund Doubles to $9M as Investor Fears Grow Over Runaway Inflation



Accredited investors worried about out-of-control inflation have poured millions into Bitwise’s bitcoin fund as a means to preserve the value of their portfolios.

An amended filing with the Securities and Exchange Commission (SEC) last week showed the asset manager had raised, in total, just under $8.9 million for its Bitcoin Fund, which provides accredited U.S. investors with exposure to bitcoin through a traditional product.

This marks the single-largest increase in assets raised in the fund’s two-year history. A filing from 2019 shows the Bitcoin Fund had attracted $4.1 million in investment, meaning the fund has more than doubled in size in the past year.

While bitcoin has come on in leaps and bounds in its acceptance among the traditional investment community, Bitwise’s head of research, Matthew Hougan, told CoinDesk the more immediate cause for the surge in the fund’s size came from concerns over runaway inflation.

“With the unprecedented expansion of the Fed’s balance sheet, the radical amounts of fiscal stimulus, and the Fed’s new and significantly more dovish inflation policy, [Bitwise clients] are looking for a hedge,” he said in an email.

“Bitcoin is the most efficient hedge for inflation that exists in today’s market,” he added.

Fiscal stimulus has become a favored tool for governments and central banks as they battle to keep economic activity alive in the wake of the pandemic. The Federal Reserve initially pumped more than $2.8 trillion into the economy and dropped interest to rock-bottom rates.

As Congress debates another $2.4 trillion stimulus package in the run-up to the November elections, Fed chair Jay Powell said this month that the central bank was unlikely to tighten monetary policy for at least three years and will even tolerate inflation above the 2% target in order to make up for the drop in consumer prices during the peak of the pandemic.

Hougan said that many of Bitwise’s clients were financial advisors who serve wealthy investors, themselves wary about the debilitating effects inflation can have on their portfolios. Many investors see Bitcoin’s fixed supply of 21 million as a means to preserve value in the event loose monetary policy leads to runaway inflation.

Indeed, other fund managers have experienced similar surges in demand from the same stratum of well-heeled investors. In the summer, $250 million found its way into three funds run by the New York Digital Investments Group (NYDIG); Pantera Capital told the SEC in August it had received nearly $165 million in placements from qualified investors – those worth at least $5 million.


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