According to Some, as Bitcoin Reaches New Heights, a Peak May Be on the Horizon

The price of Bitcoin has increased by approximately 150 percent, and it is now trading at more than $18,000 for the first time in three years. Even though it would appear that the value of the cryptocurrency is going up, there are a lot of reasons to be skeptical and assume that this is the highest it will ever get.

The level of avarice has reached an all-time high

According to Cointelegraph, the Crypto Fear & Greed Index hit 94 on Thursday, coming dangerously close to the all-time high of 95. This was a significant indicator that pointed in a negative direction for the price of bitcoin, which had been climbing. The index is derived from a number of different investor sentiment assessments, and it provides a score out of 100 to determine whether the cryptocurrency markets are currently oversold or overbought. As the index gets closer to 100, the likelihood of a market reversal increases in a direct proportion to that increase.

Since it was first introduced in 2018, the index has had a good track record of accurately predicting price highs on multiple occasions. On their website, the creators of the Crypto Dread & Greed Index state that the behavior of the cryptocurrency market is highly emotional, which results in terrifying selling or fear of losing out, which drives up prices.

In June of 2019, the index hit a new all-time high of 95, and a market analyst for Cointelegraph Markets named filbfilb tweeted that the structure of the market this year is “very similar” to the structure of the market from the previous year.

A price adjustment for bitcoin has been requested on multiple occasions

In point of fact, as the cost of bitcoin continues to rise, an increasing number of people are calling for a market correction. According to the CEO of CryptoQuant, who spoke with Cointelegraph, the Exchange Whale Ratio suggests that whales are making more deposits into exchanges. This is the conclusion that can be drawn from the data. When whales deposit bitcoin into exchanges, it often sends a signal that they are getting ready to sell and profit on their holdings. This suggests that selling pressure is on the horizon because it indicates that whales are getting ready to sell.

The Exchange Whale Ratio, like the Crypto Fear & Greed Index, is presently hanging exactly at a level that has traditionally been linked with a significant price decline. Over the last few days, the ratio has been more than 85%, indicating that a potential correction is just around the horizon.

If the ratio is less than 85 percent, it is likely that the price will continue to rise; however, if it is between 85 and 90 percent, it suggests that a price adjustment will occur soon. A price drop of at least 100% may be deemed significant. Once a price reduction has begun, it is hard to anticipate how long the correction will last or how much the price will fall.

Despite the recent price increase, bearish are concerned about Bitcoin

In addition to the numerous other indicators pointing to a decline in the near future, several well-known investors have been bearish on bitcoin for some time. For example, Bridgewater Associates’ cryptocurrency bear Ray Dalio took the time this week to dwell on the matter in a series of tweets. This occurred as bitcoin continued on its path to a new all-time high.

He admitted that he might be wrong about something related to bitcoin and expressed a desire to be corrected, but he is skeptical about the viability of cryptocurrency as a method of exchange. He also expressed a desire to be corrected. According to Dalio, bitcoin is not a suitable medium of exchange due to the fact that it appears to have too much volatility for the majority of businesses to use.

In addition, Dalio has asserted that bitcoin is not an efficient method for the storage of assets due to the fact that its value is highly unstable and bears no correlation to the prices of the things that he requires. As a consequence of this, he maintained that holding bitcoin did not safeguard his ability to conduct transactions. In addition, he is not persuaded that significant financial institutions, such as central banks, institutional investors, and others, will ever purchase enormous amounts of bitcoin to keep it as a type of reserve asset. This is something that he views as unlikely.

Should you be more concerned about the immediate future or the distant future?

According to Business Insider, self-proclaimed “bond king” Jeffrey Gundlach has been wary of bitcoin for a considerable amount of time. Before a month had passed, he gave an interview to RealVision in which he stated that he did not have faith in Bitcoin. He believes that the claims that it is anonymous and untraceable are both false and that it is not untraceable. He also believes that the claim that it cannot be traced is false. On the other hand, Gundlach asserted that he does not consider himself to be a “bitcoin hater.”

The CEO of JPMorgan stated earlier this week that the cryptocurrency is not “his cup of tea,” which came at a time when bitcoin was experiencing a period of rapid growth. In the past, he has expressed his opposition to bitcoin using language that was much more strident. This time around, he gave a presentation on Wednesday at the New York Times DealBook Summit. In the past, he has referred to bitcoin as a “fraud” and asserted that the cryptocurrency “is not going to work.” In addition, he stated that if traders at JPMorgan engaged in cryptocurrency trading, he would “fire them in a second” because this practice goes against the principles of the company, “they are ignorant,” and “both are unsafe.” Even the most ardent bulls should be worried about a drop in the price of bitcoin, even if they don’t go as far as to agree with the skeptics entirely. It’s possible that for every ten people who are bearish on bitcoin’s long-term prospects, ten people are bullish on bitcoin’s long-term prospects.

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