Notably, last year El Salvador's president planned to legalize bitcoin as the national currency, invest in this asset and issue bonds backed by it. The latter idea has failed so far. However, the first two plans have been implemented. Nayib Buquele is optimistic amid the biggest Bitcon's collapse and urges investors to remain calm. The Salvadoran leader believes that investing in BTC is safe and the cryptocurrency will grow significantly after the bear market.
Moreover, El Salvador has purchased 2,301 Bitcoins ever since it legalized BTC as legal tender alongside with the US dollar in September 2021. The country's investment in BTC has lost 50% of its value or over $50 million due to Bitcoin's collapse. Earlier, El Salvador repeatedly asked the IMF for another loan to support its economy. Therefore, such a drawdown is extremely significant for the country.
"I see that some people are worried or anxious about the Bitcoin market price. My advice: stop looking at the graph and enjoy life. If you invested in BTC, your investment is safe and its value will immensely grow after the bear market. Patience is the key", Bukele wrote on his Twitter account.
El Salvador's Finance Minister Alejandro Zelaya dismissed concerns last week saying that "the fiscal risk is extremely minimal." He added: "When they tell me that the fiscal risk to El Salvador because of Bitcoin is really high, the only thing I can do is smile."
Bitcoin is currently trading below its 2020 lows. It has lost more than 12% of its value over the weekend. BTC has sunk by 33% in the past seven days.
Currently, a lot of experts try to predict the cryptocurrency bottom and its future growth. Renowned American showman Jim Cramer expects that BTC will fall to $12,000. Doubleline Capital CEO Jeffrey Gundlach said that Bitcoin would drop to $10,000. Robert Kiyosaki, the author of "Rich Dad Poor Dad," stated recently that BTC could decline to $9,000.
It is advisable to give more realistic forecasts about BTC price movement according to the chart. As for Bitcoin's short-term prospects, it is obvious that only few traders are willing to buy it even at the current lows. To develop bulls' initiative, they should be active around $21,000. Only consolidation above this range will quickly return the trading instrument to $21,850. This move will calm down investors deeply shocked after Bitcoin plummeted below $18,000 at the weekend. A breakout of the nearest support around $19,600 and another consolidation below that range would result in Bitcoin's move to reach the low of $18,400 again, and then it is close to $17,540.
It is difficult for Ethereum to overcome the level of $1,156. Therefore, it is necessary at least to renew its high and it is advisable to consolidate higher than this range. An upward correction is possible only after ETH returns to $1,156. This move will quickly bring the cryptocurrency back to $1,255 and then it is close to $1,385. Thus, it will cause a serious problem for traders. Only consolidation above the given range will allow to form an uptrend on the trading instrument with the prospect of renewing the highs near $1,548 and $1,746. In case ETH keeps being under pressure, it is possible to buy the cryptocurrency around the nearest support of $1,050. A breakout of this range will result in a new collapse of Ethereum and moving to $964. In this case, it is advisable to consider new lows: $876 and $763 where major players will be active again.