Is the bear market back or just a correction? Or even like this: $10,000 or a new Bitcoin bull cycle?

The bitcoin exchange rate fell amid claims from the US authorities to the staking of cryptocurrencies on the example of the Kraken exchange. However, this did not stop Pantera Capital from announcing the start of a new Bitcoin bull market.

On February 9, the US Securities and Exchange Commission (SEC) issued a press release according to which the Kraken exchange agreed to stop staking cryptocurrencies and pay a $30 million fine. Against this background, Bitcoin broke through its 20-day support and went towards $21,000, as promised.

According to the Cryptocurrency Screener Cryptovizorwhich determines the market price of BTC/USD based on the results of trading on the largest spot exchanges, the lowest point of the fall of the asset was recorded on February 10 and amounted to $21,441.

12 hour bitcoin chart. Source: Cryptovizor

That day, SEC Chairman Gary Gensler explained that bitcoin was not falling out of nowhere. It turns out that the new policy of the regulator is to prosecute the staking of cryptocurrencies, which violates the right of US investors to an unconditional profit.

Gary Gensler outlaws staking on CNBC

At the same time, the head of the trading firm Eight, Michael van de Poppe (Michaël van de Poppe), voiced a question that worries the entire digital community: “Is the bear market back or just a small correction?” A little later, he described what happened in more detail, as well as the aspirations of the community: “Bitcoin lost its repeatedly tested support and found the next support at $21,500 – this is normal.”

People expect bitcoin to automatically drop to $10k and that’s what we need (highlighted by me – A.A.) + massive FUD due to SEC.

These aspirations were ardently supported by trader Crypto Tony, who demanded today on twitter from bitcoin to drop to $10,000 and give everyone the opportunity to buy normally. Trader also notedwhich is badly imagined now, the reversal of the downward trend of the cryptocurrency due to dollar strengthening (DXY).

2 hour bitcoin chart. Analytics: Crypto Tony
12 hour dollar index chart. Analytics: Crypto Tony

The bear market is over, says Dan Morehead

But all this torment by bitcoin-hungry speculators is nothing compared to the extreme optimism of Dan Morehead, CEO of asset management firm Pantera Capital. On February 8, he published a lengthy review with the promising title “The Seventh Bullish Cycle”in which he shared his bullish views with investors.

“Pantera has been watching bitcoin cycles for 10 years, and I traded cycles like this for 35 years,” Morehead recalled his background, and then made a principled statement:

I believe that blockchain assets have already reached their lows and that we are in the next bull market cycle – regardless of what happens in interest rate sensitive asset classes.

Interestingly, in this way, the director rejects the further correlation of cryptocurrencies with the stock market, which depends on the policy of the US Federal Reserve.

Morehead went on to analyze previous Bitcoin market cycles: “The average duration of the downtrend was 307 days, and the previous bear market lasted 376. The average price decline was -73%, and the bear market ended at -77%.”

Bitcoin market cycles. Source: Pantera Capital

“I think this is over, and growth begins,” summed up the head of Pantera Capital.

So $10,000 or a new bull cycle?

It is clear that Bitcoin at $10,000 and the new Bitcoin bull cycle are two incompatible scenarios.

Analyst Caleb Franzen remindedthat the simple and exponential 200-day moving averages (200MA), which are now in the range of $19.7-21.4 thousand, are of fundamental importance.

If we return to this range and turn it into support, it will open a bullish outlook. If we break through it, then the consolidation of bitcoin may take years.

Bitcoin 1-day chart and 200-day moving averages. Source: Caleb Franzen

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