In a recent podcast, Bitcoin analyst Natalie Brunell asked David Hunter, Chief Macro Strategist, for his outlook on Bitcoin price. Hunter had previously warned that Bitcoin could fall from above $100,000 to $75,000, a call that played out. According to him, the cryptocurrency could potentially fall as low as $50,000.
However, Hunter made it clear that his view is based purely on technical analysis.
Hunter Questions Bitcoin’s Liquidity Environment
Discussing why Bitcoin has underperformed alongside gold, Hunter questioned whether the market actually has the level of liquidity many investors believe.
“We shrunk the balance sheet here from nine trillion down to six and a half, or 6.4 now or 6.7, I think. So liquidity is not, at least traditional liquidity of print money, is not really there.”
He added that while authorities have injected liquidity into the banking system at certain points, he is not convinced that broad liquidity is expanding aggressively.
“I’m not so sure that we have this massive liquidity out there that some people want to look at rates and things and say liquidity’s expanding. I’m not sure we have a lot.”
BTC to drop at $50K?
Hunter said he had taken a technical position on Bitcoin above $100,000 after studying its chart.
“What I read in the charts, this thing could go to $75,000. And then I’ve since said, next step, maybe $50,000.”
He also stressed that investors should treat his forecast cautiously because he does not closely follow Bitcoin.
“I’m bearish Bitcoin, but I’m the first one to tell you I don’t follow it. So people should take that with a grain of salt, strictly a technical read.”
According to Hunter, the current weakness may be driven more by market momentum than fundamentals.
“Momentum begets momentum. A lot of the reaction in Bitcoin is more to do with the negative tape than it is fundamentals.”
He compared Bitcoin’s price action to other markets such as silver, where investors rushed in after prices surged from $100 to $120, only to later find themselves underwater and selling as momentum reversed.
Bitcoin Faces a Major Long-Term Test
Hunter compared Bitcoin’s situation to silver, where investors rushed in during a powerful rally before selling once momentum reversed. He thinks similar behavior can affect Bitcoin, particularly when leveraged players face pressure.
However, the host Brunell remains optimistic that Bitcoin can withstand a major downturn. Hunter said he has wanted to see Bitcoin survive a global economic bust before making a final judgment.
“I want to see it get through the bust. After that, I’ll be able to know whether it’s something that’s as real as everybody says it is or not.” He said.
