StanChart Suggests Buying Bitcoin Below $90,000, Confirms $200K Year-End Price Prediction

Bitcoin Faces Macro Risks: A Strategic Buying Opportunity Below $90K?

Bitcoin (BTC) is feeling the effects of mounting macroeconomic challenges as it hovers near the critical $90,000 support level. According to Geoffrey Kendrick, head of digital assets research at a leading financial institution, any price retracement below this threshold could serve as a "medium-term" buying opportunity. Despite current market volatility, Kendrick remains optimistic about Bitcoin’s long-term potential.

In a recent research note dated Jan. 14, Kendrick highlighted the strategic value of accumulating Bitcoin during downturns. While there are concerns about a possible dip into the low $80,000 range if Bitcoin fails to hold the $90,000 level, he emphasized that this could present an excellent entry point for investors.

Macro Risks Weighing on Bitcoin

At present, Bitcoin is trading near $96,000, navigating a volatile landscape shaped by several macroeconomic factors. Investors are focused on upcoming U.S. Consumer Price Index (CPI) data and the potential for significant policy announcements tied to President Donald Trump’s Jan. 20 inauguration.

Market analysts remain divided on how the inauguration will impact Bitcoin in the short term. Some speculate it could trigger a "sell-the-news" event, potentially leading to a deeper correction and testing of the $80,000 support level.

Moreover, unwinding positions in Bitcoin-focused exchange-traded funds (ETFs) is also contributing to market pressure. Kendrick notes that the average purchase price of Bitcoin for major ETFs and corporate holdings, such as MicroStrategy, has hovered around $94,000 since the U.S. election. A decisive break below this threshold could spark selling pressure and amplify market volatility.

Convexity Risks and Market Uncertainty

Kendrick warns of "convexity risks" that could create cascading pressure in Bitcoin markets if the $90,000 level fails to hold. This scenario could lead to further downward momentum as key technical and psychological levels are breached.

Nevertheless, Bitcoin has managed to stay well above $90,000 thus far, providing some reassurance to investors. As of now, Bitcoin is trading at $96,593, signaling resilience despite the broader concerns.

Looking Ahead: $200K BTC by 2025?

While short-term risks persist, the long-term outlook for Bitcoin remains bullish. The institution maintains its ambitious $200,000 price target for Bitcoin by the end of 2025. This projection is based on expectations of increasing institutional adoption and favorable economic policies under the new U.S. administration.

In the near term, the research head advises investors to exercise caution while looking for opportunities to strategically accumulate during price dips.

Key Takeaways for Investors

Although Bitcoin faces immediate macro challenges, its long-term growth potential remains intact. A price dip below $90,000 could provide a strong buying opportunity for investors with a medium- to long-term outlook. Staying vigilant for key support levels and macroeconomic developments will be crucial during this period of uncertainty.

Bitcoin’s ability to weather this turbulence and sustain its position will play a pivotal role in shaping its trajectory toward the $200,000 landmark over the next few years.