One analyst who has correctly called Bitcoin’s collapse this year is warning BTC holders, saying a capitulation event for the king crypto is on the horizon.
The pseudonymous analyst, known in the industry as Capo, tells his 692,200 Twitter followers that Bitcoin continues to show signs of weakness.
While bitcoin bulls have managed to stage a rally from the current bear market low of around $15,700, Capo says the recent bounce has been significantly smaller compared to BTC’s previous surges since June.
“Each jump is smaller. Lower lows and lower highs. Support becomes resistance. $12,000 is like a magnet.”
At the time of writing, Bitcoin is changing hands at $16,840. A move towards Capo’s target of $12,000 suggests the king crypto is down over 28%.
Kapo too says that traders are probably unprepared for the drastic move lower.
“Just read the comments here and you will get a second confirmation (first is the analysis and indicators) that most people are trapped above $17k or higher and couldn’t take another drop. Like I said, most people aren’t prepared for what’s coming, and it shows.”
He adds that the current trading environment in crypto and the stock market appears to be creating a “perfect scenario for an orderly capitulation.”
“Stock market bleeds, altcoins break key supports, indicators are pointing down, bulls get euphoric and cocky for tiny pumps.”
Looking at the stock market, Capo says the S&P 500 (SPX) remains in a downtrend after respecting its diagonal resistance.
“Clear bearish retest. Downtrend intact.”
Traders are keeping an eye on the performance of the SPX as a weak index suggests investors remain wary of risky assets like stocks and crypto.
Don’t miss a thing – Sign up to receive crypto email alerts straight to your inbox
Check the price action
follow us on TwitterFacebook and Telegram
Surf the Daily Hodl Mix
Disclaimer: Opinions expressed at The Daily Hodl are not investment advice. Investors should do their due diligence before making any risky investments in bitcoin, cryptocurrency or digital assets. Please note that you transfer and trade at your own risk and any losses you incur are your responsibility. The Daily Hodl does not recommend the purchase or sale of cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.
Featured image: Shutterstock/Roman Sakhno