A closely watched crypto strategist thinks crypto bulls are being trapped as traders appear to be at the forefront of a potential sell-off.
Pseudonymous analyst The Flow Horse tells From his 191,700 followers on the social media platform
“I’m cautious if anyone takes yesterday’s long liquidations as a signal to be very optimistic again as we stand on the cusp of what should be a big ‘sell-the-news’ event. I think the trap has been set.’
The analyst may be referring to the possible approval of Bitcoin Exchange-Traded Fund (ETF) applications in the spot market. Bloomberg analyst James Seyffart previously predicted that regulators are preparing to give the bids the green light next month.
Industry veterans have been cautious about the potential impact of the approval on the price of BTC. Chris Burniske, the founder of Placeholder Capital, recently said that the event is unlikely to be bullish for BTC.
“That said, I still think the approval period for BTC ETF around January 10, 2024 is a blur:
- Rejections: Sale.
- Approvals: Everyone who is going to buy bought in anticipation.
It will take time to turn on the marketing machines of TradFi giants (traditional financial companies) and convert the approvals into buying flows.
Fade away.”
According to The Flow Horse, this is now within the realm of possibility for Bitcoin to see prices under $40,000.
“Where should the market go to involve the most people? Probably around $38,000-$39,000. It feels too organized here.”
At the time of writing, Bitcoin is trading at $40,994.
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Generated image: Midjourney