Bitcoin Analyst Who Predicted 2022 Crash Warns of Huge BTC Reversal

[ad_1]

The year 2023 shows, at least in part, renewed investor sentiment in the Bitcoin market. According to CoinMarketCap, the total market capitalization of cryptocurrencies currently stands at $846.4 billion. Only a 1% drop from yesterday’s market cap of $853.9 billion.

This spike in stock valuations can be attributed to the recent bullish price actions in the market. Based on data from CoinGecko, major cryptocurrencies Bitcoin and Ethereum are all seeing a price surge, with BTC even breaking above its $17,000 resistance level.

This upward price trend is however not continuous according to CryptoCapo.

The prominent crypto expert who correctly predicted the fall of Bitcoin (BTC) in 2022 believes that the current market rise is likely a bull trap.

Image: Commercial Warrior

A bullish trap occurs when a trader or investor buys an asset that breaks above a resistance level; this is a common approach based on technical analysis. Despite the fact that most breakouts are followed by substantial gains, the stock could quickly turn around.

Now, even when Bitcoin breaks above $17,000, the pseudonymous analyst known in the industry as Capo is tweeting to his 698,800 followers that he anticipates a market correction.

The spotlight is on Bitcoin

With the crypto king in mind, CryptoCapos’ view of Bitcoin is still bearish. His recent tweet read:

Zoom out. Ask yourself: why am I buying here? Is it because of FOMO? You see random altcoins having random pumps, as has been happening since the start of the downtrend, and you feel the urge to buy. You might think that might be the bottom.

However, this sentiment was met with hindsight. According to one user, Bitcoin follows a four-year market cycle. If this cycle is not broken by BTC, this year will be the period of accumulation leading up to next year’s bull market.

But then the question arises whether this rally led by BTC is sustainable. According to CoinGecko, all of the major gainers in the current rally are random altcoins, as mentioned by CryptoCapo. But with the market anticipating a better macro picture, the rally in random altcoins may continue in the coming days.

Here is one of Capo’s most recent tweets:

Crypto and macro and how they are intertwined

Macroeconomic indicators have an effect on the cryptocurrency market. CryptoCapo, however, appears to be bearish on the macro side, as it predicts that the S&P 500 would experience another bearish episode before the rally.

BTC Total Market Cap at $331 Billion on Daily Chart | Chart: TradingView.com

With Consumer Price Index (CPI) data set to be released this week, it remains to be seen if the macros are supporting this crypto rally. But with Bitcoin facing stronger resistance at $17,552, this rally that the wider market has been following could be in danger of a massive correction.

In the long term, if BTC continues to follow its four-year market cycle, a rally led by Bitcoin would bring huge gains to the crypto market.

In the short to medium term, however, investors should keep an eye on the CPI data released this week as this will determine the US Federal Reserve’s stance on the market.

-Featured image by Coincu News

[ad_2]