Despite the bullish Bitcoin movement: Historically precise analyst sees correction coming
Bitcoin has experienced an extremely strong rally in recent weeks, which has seen the coin rise to as much as $18,900. BTC has risen by around 70 percent in the last five weeks, making it the best performing macro asset in this time frame.
But just weeks ago, few investors thought BTC would move so high and so fast. When the coin started to consolidate at $13,000-14,000 about a fortnight ago, many were sure that a return to the $12,000 range was in sight. For Bitcoin Code some more conservative analysts Bitcoin had already recovered too quickly.
However, one trader predicted a move to $18,500. That was „Bitcoin Jack“ – a pseudonymous analyst who had accurately predicted every major macro move since the March crash.
On March 13, literally hours after BTC had reached $3,500, he predicted a V-shaped reversal to $10,000 by May or June. And recently, as mentioned above, he predicted $18,500.
He based his predictions on a number of technical trends, including the Elliot wave and market cycles, and on fundamentals.
Top trader believes correction in Bitcoin likely
Today Bitcoin Jack has announced that he wants to shorten BTC. Because he believes that there will be a withdrawal.
As evidence, he shares the chart below, which shows that Bitcoin is in the midst of breaking below a parabolic upward trend, which it has been in since the September decline.
In short, the loss of a parabolic uptrend often indicates that a 60-80 percent retraction of the parabola will occur. This would mean that Bitcoin would move into the $13,000 region in the coming weeks.
I am slowly starting to build a short position pic.twitter.com/UvlhhssSkF
– //Fiat 𝕵ack 🐐 (@BTC_JackSparrow) November 22, 2020
Still bullish in the long term
Despite these correction risks, the same trader remains bullish in Bitcoin in the long term.
In the thread below, he outlines some of the many fundamentally positive trends for the crypto-currency area that should fuel a longer-term bull market.
These include, but are not limited to:
- JPMorgan is bullish on Bitcoin.
- Billionaires buy Bitcoin – such as Paul Tudor Jones, Stanley Druckenmiller and Michael Saylor
- PayPal launches support for purchases in cryptoelectronic currency and soon e-commerce transactions in cryptoelectronic currency.
- Grayscale buys a large amount of BTC on behalf of its institutional customers.
- China mentions Bitcoin on state television in a positive light.
- The volume of inactive BTC, which has reached historical highs, indicates increased holding activity by long-term investors.
- Fiat supply is increasing rapidly due to monetary stimulus in response to the pandemic.