A widely followed crypto analyst says Bitcoin (BTC) is gearing up to lure the BTC bulls with another rally to the upside before eventually turning back.
In a new strategy session, pseudonymous crypto trader Credible Crypto tells his 354,400 followers on social media platform
“Initial rejection here, but we wouldn’t be surprised if we go back again to hit those equal highs before the ‘real’ flushdown begins.”
In an accompanying video update, Credible Crypto explains its position further, saying that traders should watch out for BTC surges that are not caused by short squeezes.
According to the trader, the top crypto asset, as measured by its recent rise in market cap to $38,000, was the result of a short squeeze that has since ended, paving the way for a coming dip.
“What we want to see in these moves upward is that we can take it more seriously; not necessarily short squeezes, but rather point-driven moves to the upside. A move to the upside, where short positions don’t necessarily need to be forcibly closed to get that kind of momentum.”
The analyst then says that he ultimately envisions BTC losing momentum and falling again as traders with long positions panic and liquidate.
“For the first time in a long time, we have seen a significant increase in open interest from our lows. What happened the last time we had this kind of rise from the lows? We saw a pinch down…
So we see another increase in open interest on an upward trend, which is mainly long [traders] jump in…
What that means is like [BTC’s] the price could be forced back down…we’ll probably see some of these longs panic and start closing and that forces [the] price down even faster.”
Bitcoin is trading at $37,752 at the time of writing, down fractionally over the past 24 hours.
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Generated image: Midjourney