Is Bitcoin bottoming out or will it continue its downtrend? cryptocoin.com We now look at how 5 analysts and traders answered this question. As Bitcoin rallied on Monday evening, five analysts and widely followed traders are giving their opinions on the largest cryptocurrency by market cap.
Bitcoin up or down?
Popular cryptocurrency analyst Michaël van de Poppe told his 535,000 followers on Twitter that Bitcoin and Ethereum bounced well on Monday evening after the Turkish lira rebounded. He believes the cryptocurrency market will bottom out in December or early January and altcoins will recover in the first quarter of 2022. He predicts that Bitcoin will continue its bull run in the second quarter. The famous analyst says:
I believe we will repeat history. Market low in December/early January. As interest waned, altcoins hit rock bottom. Altcoins will work in the first quarter of 2022. Bitcoin will continue to operate in Q2 2022. Fix Q3 2022. Bull ending Q4 of 2022.
Justin Bennett, a cryptocurrency analyst, said on his YouTube channel that he feels Bitcoin could drop to the $42,000 level and potentially $40,000 before finding a bottom. He noted that Bitcoin tends to fill liquidation wicks and move below them before recovering.
Cryptocurrency analyst Benjamin Cowen said that if BTC returns to its last local high of $49,500, the cryptocurrency may have temporarily broken its downtrend. He assumes that Bitcoin fills the wick and will buy more of the cryptocurrency and says: “I guess I’ll assume it’s a wick, I’ll still get some #Bitcoin and go to sleep.”
The analyst, nicknamed Altcoin Sherpa, believes that Bitcoin could rise to the $55,000 range first and then drop to new lows. The analyst says:
To clarify: From here we don’t see low breakouts on higher timeframe charts below 41-42k. We can go to 55k first, then new lows, it’s definitely possible. But it would be very surprising for me to leave here like only 35k.
On the other hand, according to Will Clemente, an on-chain analyst, Bitcoin is setting up a big bear trap. Popular on-chain analyst Will Clemente looks at a few key indicators that suggest a potential bear trap for Bitcoin could emerge in the near future. Clemente is looking at derivatives data to see if traders are overbought or overbearing in BTC. Analyst says:
We were cautious when we went down two weeks ago, but reset the metric to the lowest level since May earlier this year. Still in generally healthy territory, but a little bit of enthusiasm since [açık ilgi] began to see accumulation. Don’t think these are aggressive long-terms because crowdfunding was muted and even turned negative on Tuesday.
Is open interest growing?
Open interest is the total number of active derivative contracts held by traders. Market participants use the data as an indicator of sentiment and trader bias. According to Clemente, derivatives data shows that traders are not placing aggressive long positions, reducing the likelihood of another market correction through a long squeeze, similar to what happened on Dec. Clemente also adds that he sees a discrepancy between the illiquid supply shock rate and price when comparing the movement of cryptocurrencies from liquid (weak hands) assets to illiquid (strong hands) assets. Analyst: “It would be pretty funny for me if this bullish divergence continues like the last two. I’m just watching the price action to confirm it’s playing. Patience is key,” he says. According to Clemente, on-chain metrics and data he has seen from derivatives markets suggest that Bitcoin could place a major bear trap. Clemente says:
The last time I called for a major Bitcoin short squeeze was on July 23, a day before it squeezed summer lows. We’re not there at the moment, but installation becomes more likely [bence].
While Clemente is looking at the possibility of a Bitcoin rally, he says the 30-day moving average of the output profits ratio (SOPR) shows that market participants are currently making losses. Clemente said he will remain cautious about BTC until the SOPR rises above 1 to indicate that market participants are in profit. Analyst:
The 1 threshold (black line) serves as the median between the profit and loss status. When it is down, market participants collectively suffer. When it’s above, market participants make a profit in aggregate. In 2017, BTC didn’t fall below the 1 threshold once in SOPR’s 30DMA, and once it did, it was consistently rejected from every bottom side retest of 1.
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