Here’s why analysts have predicted Bitcoin price drop to $28,000

Amidst the broad crypto market bloodbath, analysts have identified key metrics that indicate further drop in Bitcoin price. BTC price has consistently dropped after hitting an all-time high six months ago, hinting at the possibility of crypto winter. 

Bitcoin price could bleed as crypto winter arrives 

The “Crypto Fear and Greed Index” by Alternative.me is considered a key indicator of investor sentiment. The indicator compiles data on volatility, market momentum, social media surveys, Bitcoin dominance and trends. 

The sentiment, therefore, reflects the attitude of investors towards a cryptocurrency. Since sentiment can influence traders, it is used for short-term price predictions. 

 The index reveals for a large portion of 2022, the sentiment in market participants has been “fear,” and “extreme fear.”

Crypto Fear & Greed Index

The sentiment has remained largely unchanged since January 2022, alongside a general slump in sentiment on stocks. A prolonged period of falling prices and negative market sentiment is indicative of crypto winter. 

In early 2018, crypto winter set in, Bitcoin price plummeted 85%, and altcoins continued to bleed. Lark Davis, a leading crypto analyst, recently observed that Bitcoin closed its sixth consecutive red candle. The last time this occurred was in 2014, ahead of a Bitcoin bear market. 

The source of Bitcoin inflows to exchanges is another critical metric used to identify an upcoming trend reversal or a shift in trader sentiment. Inflows from private wallets were lower than 10% across exchanges. This number has hit 40% with a massive spike in exchange BTC inflows from private wallets. 

Philip Gradwell, chief economist at Chainalysis, believes this metric reveals that there is a rise in selling pressure on Bitcoin across exchanges. 

Peter Brandt, legendary veteran trader recently predicted Bitcoin price drop to $28,000. While analysts like @rektcapital believe Bitcoin price could plummet lower, @Nebraskangooner, advisor at PrimeXBT, argues Bitcoin price could recover if the asset sustains above the $32,000 support level. The analyst notes that, for now, Bitcoin price is at lower support areas.