This Bullish Crypto Trader is Predicting a ‘Breakdown’ for Bitcoin Price Tomorrow
Could bitcoin take a steep fall on Wednesday? A trader weighs in with a theory.| Source: Shutterstock
According to a trader who offers professional consulting and provides an altcoin signals service via Telegram, Bitcoin is very likely to “breakdown” by tomorrow.
Alan Masters published an idea to Tradingview late last night encouraging everyone to “secure profits” and play some wait and see. He provides the following chart:
According to Masters, the volume is dissipating in Bitcoin markets, which is indicative of a massive change impending. Combined with “mostly sideways-bearish action,” and negative technical indicators, Bitcoin is likely to drop hard.
Hedging his own predictions, Masters says:
We always say that Bitcoin tends to do what nobody expects. […] The chart has more bearish than bullish signals, but I am a strong bull.
Trading Altcoins for Greater Leverage
Especially in recent times, one wouldn’t be making much profit shorting or longing Bitcoin. The thing has been in the $3300-3700 range, with minor moves, for some moons now. The current “bear” market – more than 300% its first all-time-high, all the time – definitely underscores the fact that mainstream interest in Bitcoin is what drives volatility. Could it be that the problem with mainstream interest is its passing nature?
Masters and his team deal with this by trading altcoins.
He published a couple strategies that have made him some money recently. Trading the new Bittorrent token against Bitcoin on Binance, he’s pulled over 100% profit by using a regimented strategy. Starting at 16 Satoshi, they rode the chart up to 37, for a total of 231% profit. Supposing the amount invested is something like 1-5 BTC, the profits on this trading strategy were anywhere from $3400 to almost $20,000. Not bad for a day’s work, which is about the amount of time it took BTT to perform.
Trader Says Take Profits Soon and Wait For Better Opportunities
Comments on the Bitcoin trading idea were favorable. Masters believes that the right move with Bitcoin is to take profit soon and wait for better buy-ins that signals show are coming later. As chart evidence, he uses the following metrics:
- “Price is holding at 0.786 fib. from the last bullish wave, which is a good support but has never been able to break above EMA10.”
- “We have the MACD moving up to neutral but with zero momentum and strength. And the RSI is bearish all the way.”
Let’s explain some of these terms.
In the first evidence, he is using Fibonacci retracements to chart the current state of the Bitcoin price versus historical data. It’s a bit complex, but basically it’s a way to identify patterns. Bitcoin has a very low “Fib” as of late.
EMA is “exponential moving average,” a data factor that derives most of its importance from the recent activity of a symbol. A low EMA means the potential for big positive moves is limited.
MACD means “Moving Average Convergence Divergence.” It is a math equation based on short-term EMA and long-term EMA.
The RSI or Relative Strength Index is a more commonly known indicator. Its primary purpose is to determine if something is overbought or oversold. Overbought assets often find themselves a new home at a lower price.
The RSI is difficult to read correctly during a true crypto bull run, because while millions of dollars are flooding in on the buy side, sell orders keep getting filled at a higher and higher price.
Can’t Fight Against The Youth
We’re not in a crypto bull run, currently, though. We’re more in a bear standoff.
As Masters and many expect, something big is about to happen. We just don’t know what. One or two large hedge firms, holders, or companies could decide to kick off the decline. Or the opposite. Anything can happen, but most bets are on greater discounts inbound after tomorrow.
This is not trading advice. Click here for a real-time bitcoin price chart.
Featured Image from Shutterstock. Price Charts from TradingView .
