Ledn Chief Investment Officer: How will BTC market trend in the future?

Author: Katherine Ross, Blockwoeks; Translator: Deng Tong, Golden Finance

Buckle up, we're going to dive into some technical analysis.

On Monday, Bitcoin fell below $60,000. Although the price has since recovered to that level, people are still speculating about the next support line, and some are wondering if the price will fall further.

Ledn Chief Investment Officer John Glover talked about some technical levels to watch. He said that the next support level will be $55,000 or $56,000; the last time we saw that price was in early May.

If Bitcoin falls below that level, $49,000 is in the spotlight.

Despite the volatility, Glover remains optimistic about the overall environment.

“I think there will be inflationary pressures in the fall that will drive bitcoin higher. I think the [Securities and Exchange Commission] will approve a [spot ether ETF], which could happen in the late summer, and that will drive prices higher,” Glover said.

“And then there will be some exogenous shock that we don’t even know about, but I think that could drive prices back up. But really, we all have to recognize that we’re in the early stages of bitcoin adoption by the larger investor market,” he continued.

His analysis is based on the Elliott Wave Principle, which studies recurring, long-term price patterns that result from shifts in investor psychology and sentiment. The theory posits that markets move in predictable, volatile patterns that reflect the collective sentiment of investors. If you’re a nerd like me, it’s a fun way to gauge the long-term outlook by watching how history repeats itself.

The Elliott Wave Theory assumes there are five waves in total. Based on Glover ’s assessment, we are most likely in wave three of five. As the chart shows, Bitcoin did go through waves one and two. Wave three usually indicates that another pullback is needed before Bitcoin can gain momentum higher.

The general consensus is that once we get past the summer, things might go more smoothly from there (keyword: might).

In the Empire newsletter, we’ve previously discussed Bitcoin’s move above $80,000 by the end of the year based on multiple analysis predictions.

“My core thesis is that I believe BTC will hit $85,000 to $95,000 by the end of the year, but I don’t think there’s going to be a catalyst for that until sometime in late summer, which would be the SEC approving an Ethereum ETF, which would drive all asset prices higher,” Glover said.

We could see these ETFs approved in early July. An updated registration statement was filed last week.

Glover’s prediction can be seen in either wave below.

Glover's Elliott Wave Analysis of Bitcoin

Glover noted that at this stage, Bitcoin is trading like a tech stock. Think of Meta or Tesla a few years ago. He said we will see it pull back, but then recover like it did earlier this week.

But Glover's focus is not limited to Bitcoin. He also talked about why we haven’t seen the explosive growth in altcoins that investors have become accustomed to in past cycles. This can be attributed in part to the changing investor mix in this cycle, with highly speculative retail investors in the minority. Obviously, institutions and large companies like BlackRock have taken center stage with their products. This is not particularly surprising given the events of 2022. Glover ultimately believes that, outside of the top five or so, altcoins may not rebound in this cycle.

“Traditional investors aren’t buying altcoins, it’s only retail investors who are buying altcoins, and a lot of them got badly hurt in 2023. I think a lot of the people who were very willing to speculate wildly in the altcoin market in the past are no longer there, and they got badly hurt, and now they’re like, ‘I don’t want to feel that pain again.’ So I think it’s just a matter of volume, and that’s correct,” Glover said.

So buckle up as we head out for a brutal summer in full force. If we can get through this, there may be better days ahead.