Crypto is Exploding! Confronting Gareth Soloway on His Latest Bitcoin Prediction
Why is Bitcoin going up? Will cryptocurrency crash again in 2023? Today we are joined by veteran trader Gareth Soloway to talk bitcoin, Ethereum, altcoins, & MORE!
I’m just looking at the chart on Bitcoin here. I think this is a fascinating chart where you see that we’ve had this, you know, recently move up that’s been really dramatic.
Even today, Bitcoin’s having a great push for me to be bullish overall and think a low is in on crypto and this isn’t a bear market rally.
We would actually have to establish ourselves.
Bitcoin is exploding. And to get answers, today sit down with veteran trader Gareth Salloway.
And I confront him about what the hell is happening with crypto.
We take a look at the stock market, Gareth’s next Bitcoin price targets, Ethereum price projection by end of year, and then the big question, what if Gareth is wrong on his Bitcoin price prediction?
So, what’s your take on the macro environment? We have the Fed meeting coming up. We have the banking industry seeming failing right now. What’s your take?
Yeah, so the Fed meets Tuesday and Wednesday. And I do expect a 25-basis point hike.
There’s a small chance it could be zero if the banking situation really worsens.
But it seems like it’s being brought under a little bit of control. It’s not being fixed, but at least we’re not seeing more bank failures at this point in time.
So I think a 25 basis point kind of hike makes the Fed save face.
And if we remember, like this is crazy, but just two weeks ago, Jerome Powell was out and he basically was like, hey, we might have to raise 50 basis points.
So for them to go from him saying that in front of Congress to zero, that would be a little egg on his face.
So my guess is they want to just do 25, just get a little bit out there. And then my guess is after that, they’ll probably pause.
Let’s jump right into the stock market. Primarily they have been going together, that in the crypto market, maybe not so much in the last week.
But what should investors be looking for?
Yeah, so you’re right about that. In the last week, we’ve seen Bitcoin and Ethereum in particular surge.
We’ve seen bounces in all coins, but I love the fact that we’re seeing the leadership take over in crypto because we’re looking at best of breed that’s really taking off.
And that tells us is that there is money in the financial system that trusts Bitcoin and Ethereum enough to go there for safety.
And remember, you’re seeing the reason why the market, the stock market’s decoupled and Bitcoin is going up while the stock market’s going down is because of this financial turmoil.
People are consciously making the decision that they want to take their money out of the fiat system and put it into the crypto markets.
And I think that’s fantastic. I mean, it doesn’t necessarily make me think, you know, hey, the bear market’s over in crypto, but it certainly makes me think that Bitcoin now more than ever has a future in our society.
If there was ever a more bullish narrative for Bitcoin, this is it.
I mean, this is why Bitcoin was created, right? I mean, this is literally why.
And in terms of the S&P 500, I am in the camp that I do think the S&P has a lot of downside to go.
I do think that what we’re seeing in the banking system is the tremors or the earthquakes before the big one where the economy does spin into a recession due to these massive hikes and interest rates.
And that’s going to really hurt the S&P 500, the NASDAQ, because again, remember, recession means people have less money to spend, less money to spend means less earnings per share for stocks.
And that’s going to then bring the valuations down quite substantially in the next 12 months.
Some people would call these banking collapses sort of a black swan event. Maybe some people saw it coming, but has your investors thesis changed at all based off these events?
No, I mean, I’ve been a bear since since the beginning of 2022 based on the fact that that anytime you hike rates, and this is the kicker and I learned this in the 2008, 2009 financial crisis.
I even learned this in the dot com crisis is that when you hike rates this substantially this quickly, you’re going to break things right things can’t.
You have conditioned essentially the Fed conditioned us as investors to think that they would always be there to bail us out and they would never give us tough love.
Well, they’re giving us tough love and it’s causing a breakdown in the system.
So, so I do think that again, you’re in this situation where you have to continue to think that we’re headed towards recession.
And then that recession will usher in downside at least in the stock market. I still think it’ll bleed into crypto a little bit and bring bring about potentially lower lows in crypto.
But again, lower lows for me is just a buying opportunity at this point. So, so I’ll show you the S&P 500 here. So this is the S&P. We were just talking about it.
And the S&P 500 basically you could see that you had this wedge pattern. We had a lot of sideways chop. We’ve now broken below that lower trend line.
And that creates a situation where we probably do ultimately start the bigger move down over the next month or so in the markets. I do think there could be a technical bounce back to that line. Just that’s the nature of charts.
But I do think again we’re headed down. Here’s your October of 2022 low. That’ll be technical support 3500. And then we’re probably testing this 33 75 level, which was your pre COVID high on the S&P 500. So overall, I think by end of year, we could be down 20 plus percent on the S&P
500, which is where we currently are, which would take us quite a bit lower, close to really close to 3300 33,000 on the S&P 500.
And what gives us that pivot? What what takes us out of there? Obviously, we’ll go down because less spending, less money in the market. What’s going to change 12 months from now?
Yeah. So I do think things are going to get so bad that the Fed will be forced to kind of pivot at some point. So, you know, pausing rates is fine. I mean, that’s that’s nice to see it. It kind of takes the stress off of us having
to worry about how high they’re going to go. But if you keep rates at 5%, let’s see, say that’s still high rates for the overall market and the overall economy. So it’s going to be where the Fed has to really come to the rescue.
And I don’t think they do it in 2023. But in 2024, my guess is unemployment spikes to a level. It’s not everyone thinks it’s going to be, Oh, well, when inflation gets under 2% or back to 2%. I don’t think it’s going under 2% for like five years.
So I think you’re going to have elevated inflation. Let’s say at 3%. The Fed is going to hold back. They’re going to say, Hey, listen, we don’t want to create a monster here of inflation roaring back. So let’s not cut rates.
Eventually, the unemployment gets so high, let’s say 7% 8% that they’re going to be forced to come out and cut rates. And that then triggers the next buy rally in the market.
Now, something that Bitcoin has, the stock market doesn’t. We have the having next year that’s going to cut that supply faucet in half. Is there any, is that anything to think about, you know, for investors?
I mean, historically it has, right? Historically, it’s been kind of the beginnings of the next bull cycle, if you will. And I do think that there’s a possibility of that.I do worry that, again, because we’re in this uncharted territory of Bitcoin, you know, not having the support of the Fed with printing that it could be an issue.But then again, you know, as I said, maybe in 2024, the Fed does come to the rescue and then that all kind of coincides.
I’m just looking at the chart on Bitcoin here. I think this is a fascinating chart where you see that we’ve had this, you know, recent move up that’s been really dramatic.
Even today, Bitcoin’s having a great push. But if we look at it, it’s actually in a parallel channel. And you can see up here, up here.
And then a couple of days ago, we hammered on the 26,000 level today. We pierced that level a little bit and we’re still kind of stuck in this sideways channel of price action.
So at least over the next, let’s say one, two, three weeks, this channel is what I’m following very closely. Can we get above? Can we stay above? If we can’t, and we kind of hover here, I would start expecting the Bitcoin price action to come back in.
And I also wonder if, like, you know, let’s say the banking crisis does slow down and we do see some stability. Do we see the money that was put into Bitcoin because of that instability being pulled back out and going back into the fiat system?
And this is going to be like, I mean, this is going to be a really interesting, interesting situation to watch how this reacts, how to investors that put their money from the fiat system into the Bitcoin market.
How do they react over the next couple of weeks if we see stability come back?
So what are your next price targets for Bitcoin, bullish and bearish?
Yeah, so price target wise, I think ultimately I am on the downside here. I think as long as we are still up against this line, we have to respect it.
So I’m looking for a pullback to the lower end of that channel, which is around the 20,000 level.
Eventually, I think that actually breaks. And I do think we ultimately test over the next two to three months.
We test that 15, seven level again and again hate to be bearish out there. I know so many people are bullish. I’m just not seeing the signals yet for me to be bullish overall and think a low is in on crypto and this isn’t a bear market rally.
We would actually have to establish ourselves back above 30,000. And we’re not that far now. So I mean, it could be in the next few weeks that I that I changed my tune.
But again, it has to be 30,000 because that’s your midpoint. All right. So if we look at psychological levels on the chart, remember that big move up in in early 2021.
And then the pullback, right. And the low of that pullback of that cycle was right at 30,000. And then we went up and we made a new high and then we came back down.
We consolidated here at 30,000 and finally broke lower. So to establish ourselves back above 30,000 psychologically would be huge for the Bitcoin market. And that would actually get me on the side of thinking, okay, maybe the lows are finally in until then I’ve been through too many bear market rallies that fooled me.
So I’m still on the bear market side until proven otherwise. And about six months ago, maybe more on our channel. You said that your downside target long term for Bitcoin was 12 K.
Has that changed? Are you more adamant less adamant? Yeah, I don’t think I’m more or less. It’s more the charts are in charge here. So right now the charts haven’t changed the tune that we’re still in this bear market cycle.
So for me, it would have to be when we get above that 30,000. That’s when I start to look to buy pullbacks. And just to mention this too is I’ve been long and short Bitcoin and cryptos overall, probably about five or six times just in the last month because of this awesome volatility.
But I’m talking more on the macro view, the bigger move. Then I start kind of hottling on pullbacks and buying the positions to hottle versus just looking to trade them on the long side, which is what I’ve been doing recently.
So, so I think again, the 12,000 level is still out there. I even think there’s a chance of 9,000. I hope I’m wrong. But again, I do think that is a possibility still.
And Gareth, I want to talk about what if you’re wrong, the signs that we’d see if that would happen. What you’ve and you’ve told me before that the three big things you’re looking for.
If regulation happens whenever that is, that’ll be a huge trend change when the pet fed not just pause it but but pivots. That’s a huge trend change.
And then of course if we get those TA technical indicators if you see price breaking above, that would be a reason.
Something we have just seen in this last week, the Federal Reserve has not pivoted their interest rates but they bought assets. More assets have came on their balance sheet. Does that factor in at all.
So that is the that is a potential flag that goes up. And so essentially what we’re seeing is that the fed has this window where banks are allowed to go in and borrow and basically get money from the fed.
And that’s what we’ve seen. So we’ve seen these banks that have been in so much trouble. They’re actually being allowed to take money from the Federal Reserve in that sense.
So right now again, that’s kind of like a half a step in that right direction. It isn’t the full fledged where what I want to see is I want to see the money going out to the public.
So not just being kept within the banks to keep them solvent, but actually saying, okay, QE is to push money into the system. You know, like we saw in 2021 with COVID in 2020 with COVID and that’s really where that next big, that that first big pivot would be.
Yeah, this is like a baby staff that hints and then, you know, obviously baby steps lead to full steps, but we’re not there yet.
That’s right. And honestly, I think we’ll look back at this and say, Hey, remember when it was like the first signal of that returning.
I still think it’s probably like about a year away at this point, but, but I do think, you know, these are these are signals that the economy has been like a drug addict addicted to to drugs from the Fed, which are the, this is the printing of money.
And we don’t know anymore how to deal without that. We’re like, we are literally addicted to it. And so this is the withdrawal symptoms of us freaking out over. Oh my goodness, you know, it rates are 5%.
The banks didn’t keep up with their, their risk assessment. The housing market is coming in hard. All these different things are issues that is being caused by that fed sharp rise in hike in hike rates.
One final Bitcoin question before I ask you about Ethereum.
Once Bitcoin bottoms, whenever that is from a technical standpoint, when do you see the next all time high?
Oh, wow. So, so I think again, once we once we’re confirmed on that bottom and again, whether that’s already happened or not, I think you’re looking three to five years out. I wish I could give better, you know, a better timeframe.
But I do think again, it’ll, it’ll coincide at least starting with the, the printing of money again, but and also the regulation, right? And then that that next big wave, I think is going to be a huge bull market led by institutional money that’s finally ready to kind of say, okay, we have the transparency
from regulation. Now, let’s get involved in crypto. And I even think that a recession, if I’m right, and the economy goes into a long drawn out recession, because the Fed is going to be reluctant to print us out of it.
That actually also helps the Bitcoin bull market, where we start to say, okay, stocks are no good, because earnings keep coming down. So forget stocks. Let’s go to crypto. And that’s where that pivot comes in, that real pivot that is the digital gold of Bitcoin comes in.
So three to five years out, whenever that bottom happens, you would predict if the bottom has already happens, which you believe we still more downside, but you’re saying this having that’s coming up in a year.
Usually we see it in all time high, maybe 12 months after having, you’re saying, man, it’s not going to be enough this time.
Yeah, so I think, I think we probably bottom this year in Bitcoin, but I do think, I do think that people are really hanging their hats on that having as being the catalyst for us to hit new all time highs.
I’m conservatively not so thrilled with that until we see that printing of money and really it flow into the system significantly and rates go back to very, very low levels, which I think will take longer than just up to the having so.
So I think, again, that’s the key is that the bottom probably happens in the next, you know, six, eight, 10 months, but I think it’s going to take longer than people realize to get us back to new all time highs.
We’re seeing altcoins bleed out against Bitcoin in a big, big way. It’s sort of obvious in bear markets. Bitcoin dominance increases.
Understanding that Ethereum may be lower by the end of the year. What sort of your year end price target for before Ethereum.
Let’s take a look here. So, so what I’m in the camp of, and you can see this chart is a great chart of Ethereum here. So you can see how we have this resistance trend line here that slopes down. We’ve just hammered into it. You also have a channel that’s sloping up.
And again, both of those levels, there’s a confluence of levels right in here, and that’s keeping Ethereum kind of under wraps. Again, if I’m correct, then I do think we have one final flush out on Ethereum.
My guess is you’ll get one more chance to buy it at double bottom. If I’m right, Bitcoin will make a new low. Ethereum will probably just double bottom. And again, that’ll be that opportunity to kind of jump in. So I say year end or just around year end, probably about a $900 dollar price target on Ethereum.
Gareth, I would love to have you back in about four, six weeks revisit these charts. I love when you come on. I’m titling this video confronting Gareth Soloway on Bitcoin and Ethereum, but I want you to know that’s for prime engagement. And it’s kind of talked about the bearish and the bullish.
Final thoughts for the Altcoin Daily Army.
All coin daily army is awesome. You guys are awesome. I really respect what you guys are doing and educating people. I think it’s so important. And again, I would just say that is like, you know, everyone out there just take that one or two minutes a day to kind of learn a little bit more.
Education and knowledge is the most important thing when it comes to making money in cryptocurrency. And again, just learning about it, thinking about what the levels are, what needs to happen regulatory wise, the Federal Reserve.
And in fact, I think you guys are doing that. You’re educating people out. So keep doing what you’re doing. I really do appreciate it. I think everyone else does as well.