Bernstein analysts on Tuesday suggested that Bitcoin‘s correction presents an attractive entry point for long-term investors, particularly if prices dip below $80,000.
What Happened: The report coincides with a public endorsement from Eric Trump, who tweeted “Buy the dips!!!” as Bitcoin experienced market volatility.
The cryptocurrency market suffered a sharp sell-off over the past 24 hours, wiping out $1.48 billion in liquidations as Bitcoin dropped to $87,000.
Bitcoin is currently trading around $86,950, down 8.5% on the day, while Ethereum has declined 9% to trade around $2,370.
Major altcoins are also experiencing significant losses, with Solana and Dogecoin seeing steep drops. XRP is down 10% on the day.
Bernstein’s analysis acknowledges that Bitcoin is down 15% in the last 30 days and has broken below the $90,000 support level.
What Analysts Are Saying: Analysts attribute the correction to several factors, including a recent $1.5 billion hack of Bybit, reality checks for meme coins following controversies, and broader macroeconomic concerns driving risk-off sentiment in equity markets.
Despite these short-term headwinds, Bernstein emphasizes that “we don’t believe anything fundamental has broken in our structural view of the current Bitcoin cycle.”
They believe Bitcoin is yet to reach its cycle high, which they project to be “closer to the $200,000 mark over next 12 months.”
Bernstein highlights Bitcoin’s alternating role as a high-beta US tech equity trade and a gold alternative depending on shorter-term market dynamics, however their long-term outlook continues to view the asset class a “burgeoning ‘digital gold’ asset class, driven by accelerating institutional & sovereign demand.”
The report suggests that technicals provide a way to estimate local lows, however Bernstein suggests they think it as temporary, “without altering our view of the longer-term Bitcoin bull cycle.”
“Since Bitcoin has broken the $90,000 floor, the market may attempt to test the All-time high break out around the mid $70,000 mark post the US election results in Nov. Regardless, we believe, Bitcoin in the near term, will follow the equity risk-on sentiment,” the analysts note.
Bernstein also says further Bitcoin action may occur if the White House Crypto task force provides further bullish announcements regarding a U.S. Bitcoin reserve.
“We believe, price levels below $80,000 (if sentiment continues to weaken), would offer a compelling risk-reward for investors looking to position for the next 12-18 months towards new cycle-highs,” they stated.
The analysts noted that, if the current risk-off sentiment continues longer, there may be a “few months/weeks delay in Bitcoin’s march towards our $200,000 target,” but the overall bullish view remains unchanged given expected acceleration in institutional and corporate treasury inflows.
Bernstein also provides a list of ratings on multiple companies involved in the digital asset space, including MicroStrategy with an outperform rating and a price target of $600, and Robinhood Inc. with an outperform rating and a price target of $105.
Source: benzinga.com
