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Business

Steep Corrections Imminent for Bitcoin and Ethereum After Massive Fakeout in Stock Market: Top Crypto Analyst

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A closely followed crypto strategist is issuing a dire warning to Bitcoin (BTC) and Ethereum (ETH) holders.

Crypto analyst Justin Bennett tells his 106,800 Twitter followers that the recent sell-off in the stock market suggests an imminent move to the downside for Bitcoin.

“Today’s sell-off from stocks is more than just a single red day. It confirms a massive fakeout, likely triggering an extended move lower. The 3,400 pre-COVID high is a prime target. I’ve said this since May. That’d be -16% for the S&P 500 or about -30%-40% for BTC if it happens.”

Source: Justin Bennett/Twitter

At time of writing, Bitcoin is trading at $20,049. A 40% devaluation could see BTC trading at the $12,000 price level.

Looking closer at Bitcoin, Bennett says that BTC is in danger of breaking below a diagonal support that has buoyed the top crypto since 2015.

“BTC is once again testing the 2015 trend line. Anyone telling you this looks healthy is either clueless or lying. Notice the two long lower wicks from 2015 and 2020. That indicates strong demand. We’re seeing the complete opposite of that this time.”

Source: Justin Bennett/Twitter

As for Ethereum, Bennett highlights that ETH is forming a head and shoulders top on the four-hour chart with a downside target of $1,000.

“The right shoulder of this potential ETH head and shoulders is starting to form. Confirmation below $1,500.”

Source: Justin Bennett/Twitter

At time of writing, Ethereum is swapping hands for $1,498, below the neckline of the pattern and Bennett’s confirmation level.

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Business

Bitcoin calls traders’ bluff with fresh $40K fakeout as Fed decision day arrives

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Bitcoin (BTC) tested traders’ neves yet again on March 16 as a fresh spike over $40,000 ended in minutes.

BTC/USD 1-hour candle chart (Bitstamp). Source: TradingView

Shorts feel the burn after abrupt trip to $41,700

Data from Cointelegraph Markets Pro and TradingView showed BTC/USD suddenly surging to highs of $41,700 on Bitstamp — before instantly reversing.

Two hourly candles was all it took for the entire market to rise by $2,000, break significant resistance levels and come all the way back down again.

The move, while recently commonplace, was not without its casualties, as evidenced by liquidations across exchanges.

According to data from on-chain monitoring resource Coinglass, Bitcoin accounted for $98 million of these over the 24 hours to the time of writing. Total crypto liquidations for the period were just over $200 million.

Crypto liquidations chart. Source: Coinglass

While still in the middle of its established trading range, BTC/USD took out resistance at both $40,000 and $41,000 before the latter strengthened once the pair had deflated.

On Wednesday, $41,000 remained as the sell-side pressure, but a significant build-up of sellers had yet to reappear at $40,000, data from Binance’s orderbook compiled by monitoring resource Material Indicators showed. 

BTC/USD orderbook chart (Binance). Source: Material Indicators

“Snooze party” until Fed rate hike announcement?

For analysts, meanwhile, the immediate past paled in significance compared to what the immediate future was apt to bring Wednesday.

Related: Bitcoin risks final ‘bear market capitulation’ as rich investors continue BTC selloff — analyst

At 2pm Eastern Time, the United States Federal Reserve is primed to reveal moves on interest rates, something many were keenly watching as a potential price paradigm shifter.

For popular trader and analyst Crypto Ed, there was thus nothing to see until the news came.

Twitter account PlanC meanwhile argued that the market had already accounted for the expected 0.25% rate hike, but that this would not help macro inflationary forces — which themselves arguably advertise BTC as a store of value.

“The FED will raise rates 25 basis points, which is already priced in and will do nothing to stop inflation,” the account summarized.

BTC/USD traded at around $39,500 at the time of writing, still above Tuesday’s levels.



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