A trader who experienced the crypto breakout earlier this year is warning, saying the latest Bitcoin (BTC) and altcoin rallies could abruptly reverse.
In a new strategy session, analyst DonAlt tells his 53,400 YouTube subscribers that crypto markets are likely to rise as traders anticipate the adoption of multiple Ethereum (ETH)-based futures-exchange-traded funds (ETFs).
DonAlt believes that the catalyst is not strong enough to support the latest rallies in the crypto markets.
“If you look at the daily Bitcoin chart, we are back to the cluster of resistance. Honestly, most of the time I wouldn’t really care about it since we tested it twice before this third test… But what I don’t like is when the market in my eyes resists actual bull**it- news… because bull**it stories die down very quickly…
I don’t like the narrative attributed to this, and in general I don’t like the way the market is trading right now.”
DonAlt also highlights that crypto futures products have historically been extremely bearish for the digital asset markets.
“I also think people in general just forget how Bitcoin futures ETFs fared. Mapping them on a map doesn’t paint a good picture. We’ve owned the most Bitcoin futures ETFs [coming out] at the pico tops of the market.
We had one inside [2017] – that effectively ended the bull market. Then we had another one basically 2021, if I remember correctly, also pretty close to the top. It’s not the best track record overall, so I’m very confused.”
The Chicago Mercantile Exchange (CME) was the first to introduce Bitcoin futures trading in December 2017, the same day BTC posted a cycle high of $20,000. While the CME’s product is not a BTC futures ETF, its launch coincided with the start of a crypto bear market that saw Bitcoin fall to a low of $3,200 in 2018.
In October 2021, ETF provider ProShares launched the first SEC-approved Bitcoin futures ETF. A month later, Bitcoin hit an all-time high of around $69,000 before a bear market began.
At the time of writing, BTC is trading at $27,065.
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Generated image: Midjourney