- Renowned crypto trader discloses a massive bull trap setting up after Bitcoin liquidations that happened earlier this week.
- According to him, Bitcoin could break another key support level to trade within the zone of $36k and $39k.
Bitcoin (BTC) appears bullish with a sentiment score of 93/100 and a 24-hour surge of 4.99%, propelling the asset to its current price of $43,052.78. However, the weekly gain is still negative as BTC records a 2% decline.
Speaking on the current market behavior, pseudonymous analyst The Flow Horse informed his X followers that the market is likely to set up a big bull trap.
According to him, Bitcoin investors appear bullish despite the big liquidation recorded this week, and this should be a cause to worry. Crypto data aggregator Coinglass disclosed a couple of days ago that 119,302 were liquidated to the amount of $409.80 million in just 24 hours. This saw Bitcoin pulling back to as low as $40,300. Traders who were long on Bitcoin dealt with $90.9 million in losses within the period. Interestingly, Bitcoin bears also absorbed losses of more than $13.23 million.
With this happening, the pseudonymous analyst appears a little surprised that market participants are still bullish when a major-sell-the-news event is edging closer.
I am cautious about everyone taking just yesterday’s long liquidations as a signal to be very bullish again when we are on the cusp of what should be a major sell-the-news event. Thinking the trap is being set.
More on the Bitcoin Bull Trap
While he was not specific about the event, the analyst could be talking about the much-anticipated spot Bitcoin Exchange-Traded Fund (Fund) which could be approved by January 10. While the approval is expected to attract millions of dollars into the market to drive major assets to new heights on the price curve, some renowned experts, including Placeholder Capital founder Chris Burniske do not see anything bullish about this event on Bitcoin.
That said, still think the BTC ETF approval window around January 10, 2024, is a fade: Rejections: sell-off. Approvals: everyone that’s gonna buy, bought in anticipation. Marketing machines of TradFi (traditional finance) giants will take time to turn on and convert the approvals into buying flows. Fade.
In one of the statements of James Seyffart, he cautioned that there is a possibility that the approval may not even happen within the predicted date. If it happens as predicted, there may be weeks or even months interval before the market sees a spot ETF launch. This implies that the impact on the market may not be instant.
According to The Flow Horse, the Bitcoin price may break its $40k support to trade between $38,000-$39,000.
Where does the market need to go to get the most people involved? Probably around $38,000-$39,000. Right here feels too organized.
Another renowned analyst identified as CryptoCon BitTime has predicted that Bitcoin could be heading to $47 – $48k soon. However, the market could witness a prolonged consolidation in Q2 2024, possibly in February. A price prediction platform has also put the minimum trading price of the asset this year to $51,583.32. According to them, BTC could finish the year with an average price of $64,479.15, and $77,374.98 at the maximum.
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