Despite strong rallies across the market, a closely watched trader says crypto bulls are overly optimistic right now. He also shares his thoughts on Shiba Inu (SHIB), Bitcoin (BTC) and Ethereum (ETH). Here are the details…
Capo: Bitcoin is not in the consolidation phase
As we have previously reported as Kriptokoin.com, the analyst known as Capo, who made various predictions, had a quarter of a million Twitter followers, Bitcoin (BTC) last week. He says that despite an impressive performance, BTC is still not consolidating above critical resistance levels. At the same time, Capo points out that while open interest and funding have increased, volume has decreased, pointing out that traders are putting excessive leverage on the system. The analyst uses the following phrases:
A nice formation of bulls that have shown strength over the past few days. But… is the bearish scenario invalid? The price has broken between $45-46k but has not yet consolidated above that and the recent rally has had some bearish signs: Price up, volume down, open interest down, funding rate up.
Entered bear cycle for SHIB?
Capo is also seeing some decline in the stock market. According to the analyst, the S&P 500 index (SPX), which is often associated with crypto markets, is most likely on a bearish path. “Also, SPX is facing major resistance with declining volume… Call it denial or whatever you want, but I don’t think we’re out of the woods yet. The bear scenario is still in play.”
Looking at the altcoin markets, Capo says that some coins form price action patterns that resemble bear cycles of the past. It compares the rally and correction of Shiba Inu (SHIB) to the start of XRP’s 2018 bear market. The popular analyst also reveals a bearish target for Ethereum (ETH). It sees a price target below $1,300, or about 63 percent lower than current prices, according to Capo’s chart.
At the time of writing, Bitcoin is up 11.7 percent over the past seven days to trade at $47,401, while Ethereum is up 14.3 percent at $3,397 over the same timeframe.
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