A prominent analyst and trader says Bitcoin (BTC) and XRP are on the edge of precipice and may face significant breakdowns in the short term.
The pseudonymous analyst who goes by the name Credible Crypto tells his 69,000 Twitter followers he recently went long on XRP, but was stopped out when BTC pulled back on Friday.
“Well woke up stopped out of this one as BTC saw a nasty rejection overnight. Setup I was taking is below. Now looking for a move below the dotted red lines.”
The analyst is now warning his fellow traders that the fourth-largest cryptocurrency is clinging to a key area of support.
“Dotted red lines cleared… Now things start to get interesting… Bulls don’t want to lose the dotted red lines at the lows, that would equate to a break in bullish MS (market structure) and send us down to 0.21 XRP.”
The analyst is also bearish on BTC in the near term. He believes Bitcoin will continue to pull back and could drop well below $10,000 before a turnaround. But he remains macro bullish as long as BTC remains above $9,600 on the weekly chart.
After BTC’s next pullback is complete, he believes the stage will be set for Bitcoin to finally breach resistance at $12,000 in the first quarter of 2021.
As for the broader altcoin market, Credible Crypto predicts a significant sell-off will follow Bitcoin’s potential decline in the weeks ahead. He sees the formation of a bear flag in the altcoin market cap, which he says may catalyze a massive 40% devaluation.
“Two things –
1. I apologize for your alts in advance
2. You better BUY THE EFFIN DIP when we get there”
According to the crypto strategist, altcoins with the smallest market cap remain the most vulnerable and will likely drop the hardest.
“This pattern is a standard bear flag and implies a breakdown is likely. And yes smaller alts will generally get hit harder while majors will get hit less.”
Disclaimer: Opinions expressed at The Daily Hodl are not investment advice. Investors should do their due diligence before making any high-risk investments in Bitcoin, cryptocurrency or digital assets. Please be advised that your transfers and trades are at your own risk, and any loses you may incur are your responsibility. The Daily Hodl does not recommend the buying or selling of any cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.
Featured Image: Shutterstock/GrandeDuc