A widely-followed crypto trader is warning market participants that he expects huge drops for digital assets.
In a lengthy post, pseudonymous trader and cryptocurrency carry Capo tells his 766,600 Twitter followers that he thinks Bitcoin (BTC) will fall to the $12,000 level and Ethereum (ETH) will fall to somewhere between $500 and $700, though no specific time frame is given.
The strategist, who has remained bearish on crypto assets despite this year’s rally, also says he expects an altcoin capitulation that will see them lose more than half their value.
“The analysis has not changed. The price still has great resistance and as said before, the timepiece looks manipulated. A capitulation event is still likely and the main targets remain $12,000 for BTC and $500-$700 for ETH.
Altcoins would average 60-80% down.”
Capo says many altcoins are showing signs of weakness or have already pulled back from this year’s rally and will hit new lows.
The trader says he is building short positions on a handful of crypto assets, including Binance Coin (BNB), Solana (SOL) and Polygon (MATIC), which have recently been designated as securities by the US Securities and Exchange Commission (SEC). ).
“Many altcoins have already reached new lows below that of 2022 and some are even reaching Covid lows. Others have recovered much of this year’s bear market rally and are about to hit new lows.
Therefore, I have built short positions for the medium term (with low leverage) where I add size at key resistances and in the altcoins that I think can fall more (BNB, TRX, SOL, AAVE and MATIC). All of these positions are profitable except the TRX position.
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Featured image: Shutterstock/Zaleman