Bitcoin (BTC), the world’s leading cryptocurrency, has recently witnessed a surge in price, reaching a new yearly high of $42,100 on Monday. However, this significant price increase has raised concerns among market participants about the possibility of a potential correction and a subsequent liquidation sweep, which could drive the price down to as low as $25,000.
Second Capitulation And Liquidity Sweep For Bitcoin?
Justin Bennett, a prominent technical analysis expert, acknowledges the remarkable performance of Bitcoin, stating, “It’s been a hell of a run from BTC, and it may very well continue without a significant correction in the short term.”
However, Bennett highlights that the previous two bear markets concluded with a second capitulation, suggesting the possibility of a similar scenario occurring this time. Bennet cautions against ruling out a liquidity sweep that could drive the price down to $25,000.
To provide further context, liquidity sweep refers to a sudden and drastic move in price that aims to clear out excess leverage and trigger liquidations of overleveraged positions.
Such a move could lead to a cascading effect, causing the price to drop further as more positions get forcefully closed. The occurrence of a liquidity sweep at the $25,000 level would not only test the resilience of Bitcoin but also serve as a crucial moment for market sentiment.
As seen in the 2-week chart above shared by Bennet, despite the potential correction in BTC, this could be the last difficulty that Bitcoin bulls experience before the continuation of the bull run; this will be further fueled by the potential approval of Bitcoin spot exchange-traded funds (ETFs) applications by the US Securities and Exchange Commission (SEC), which is expected to push prices even higher.
A boost from the halving of Bitcoin will further add to the bullish momentum and sentiment in the market, which could push the price of BTC to new all-time highs (ATH).
Additionally, historical trends indicate a promising outlook for Bitcoin. Analyst Ali Martinez points out that in the past, strong BTC performance during October and November has been followed by a bullish December. According to Martinez, market participants can anticipate a bullish December ahead if this pattern holds.
El Salvador’s BTC Investments Prove Profitable
El Salvador’s President Nayib Bukele…
Click Here to Read the Full Original Article at NewsBTC…
