A rough week for crypto
The crypto market has had quite a red week. When the fed announced the first half percentage point rate hike since 2000 on Wednesday, the stock market and crypto initially rallied more than 3% before dropping steeply. This move by the fed is an attempt to reduce inflation. This morning, Bitcoin dropped below $36,000 for the first time since February, while Ethereum dropped to around $2,700. With a heavy IMF influence, Argentina recently announced that they will ban new crypto activities in banks.
Altcoins besides Ethereum took a much worse beating, though, with many such as Hedera Hashgraph setting new 52-week lows. If Bitcoin can break past a resistance level at $38,000, there could be a rally to 40k or more. However, if Bitcoin goes below a support at $35,000, there could be a further drop to $30,000.
Navigating the sea of red
This meme illustrates an important point about investing in Bitcoin. It basically implies that people have FOMO and buy more Bitcoin at a near all-time high, than when Bitcoin is at a 52-week low due to fear. Now is arguably a great buying opportunity for most investors, since timing a Bitcoin low is nearly impossible.
Another important factor to consider is that the crypto "fear and greed" index is registered "extreme fear" at $36,000, when that same reading a few years ago was when Bitcoin hovered around 20k. While being in "extreme fear" territory is never a good situation, this data suggests that Bitcoin's new bottom is around 30-35k. Given that a black swan event can happen in the world at any time, there is still some risk that Bitcoin could drop below $30,000, as mentioned previously.
In these times of war and sky-high inflation, the best strategy is taking profit/losses when you need too, but HODLing your safest assets while dollar cost averaging.