Bitcoin to Grind Higher After Sell-Off, Says Arthur Hayes

Arthur Hayes, the co-founder of BitMEX, believes Bitcoin has found a temporary bottom and is poised for a slow but steady climb in the coming months. His views come after a sharp correction in the crypto market during mid-April.

In a recent blog post, Hayes attributed the downturn to several factors, including the US tax season, Federal Reserve policy uncertainty, and the Bitcoin halving event. He considers this a necessary “market cleansing” that will weed out short-term investors.

Hayes’ bullish outlook hinges on his prediction of increased dollar liquidity. He sees the Federal Reserve’s tapering of quantitative tightening (QT) and the US Treasury’s debt issuance plans as forms of “stealth money printing” that will ultimately benefit riskier assets like cryptocurrencies.

While Hayes predicts a gradual rise, some technical indicators suggest the possibility of a more significant upswing for Bitcoin. Recent price action dipped into the previously identified weekly imbalance zone between $59,111 and $53,120, potentially signaling a buying opportunity. 

Source: TradingView

This zone may have contained a buildup of sell orders that have now been cleared, creating space for sidelined buyers to enter the market. However, the recent 15% price crash within ten days may lead to investor hesitation despite the technical buy signal.

Arthus Hayes recommends holding Bitcoin (BTC) and Ether (ETH) as core long-term investments due to their established positions in the market. Hayes is also interested in high-beta altcoins for potential higher returns. He specifically mentioned Solana (SOL), Dogwifhat (WIF), and Dogecoin (DOGE), highlighting the latter’s status as the “OG doggie coin.”

Hayes emphasizes the “Buy in May, Go Away!” strategy, suggesting that summer is a good time to accumulate crypto assets. He plans to use the current market situation as an opportunity to increase his exposure to select altcoins.

His trading strategy involves utilizing Dogecoin and Solana for short-term momentum gains. For long-term holdings, he favors Pendle (a crypto project) while emphasizing the importance of strategic investment. Once positions are established, Hayes suggests a more passive approach, allowing the market to react to the inflationary effects of recent US monetary policies.

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