A closely followed trader warns that a sharp sell-off is likely on the horizon for Bitcoin (BTC) after the crypto king rallied about 100% from its November 2022 lows.
Pseudonymous analyst Cantering Clark tells his 173,200 Twitter followers that Bitcoin does not look bullish to him.
According to the analyst, Bitcoin’s recent ascent above $30,000 is likely a bull trap prior to a mean reversion, or a correction that tends to take place after an extreme move to the upside.
“I think we are just baiting longs in up here and after this monthly close we see deeper mean reversion. I think people are starting to think that spot buying means up only. I didn’t realize spot buyers don’t have a sell button?”
Cantering Clark goes on to say that Bitcoin has been struggling to print gains despite the stock market’s recent strength. The trader also mentions the Federal Open Market Committee (FOMC) meeting that is slated to happen this week.
Traders eagerly await the results of the FOMC meeting as it is the time when the Fed announces whether it will continue to hike interest rates or pause.
“-Bitcoin at a massive level 100% off the lows
-less upside capture than equities as of late
-End of April
-FOMC week
-Furthest end of the risk curve frothing
What do you think is next?”
Although Cantering Clark is bearish on the near-term price action of Bitcoin, he says BTC remains the best-performing asset so far this year.
“Before someone chimes in, I am talking locally. I am not saying that Bitcoin does not look bullish so far for the year. It is up more than anything else that is even remotely in the same profile in terms of asset size and liquidity.”
At time of writing, BTC is trading for $28,032, down over 4% in the past day.
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