Bitcoin has recently seen a significant price increase, breaking out from a period of relative consolidation. While this sudden jump in value may be exciting for investors, it’s important to remember that the highly volatile nature of the cryptocurrency market means that caution should be exercised when making investment decisions.
Can investors trust his pump or is it a bull trap? Let’s find out.
Previous Bitcoin Analysis
Last week’s analysis brought us to a rather gloomy conclusion – Bitcoin was headed down. However, the asset has done a complete 180-degree turn and is headed up. There were two possible outcomes from last week’s analysis:
- A bearish flag which would break downwards
- A double bottom that would signify a trend reversal
Bitcoin chose to go with the latter.
Current Analysis
The asset rallied massively out of the blue pushing past $18500 and setting new local highs. The asset had previously tried breaking the $18,350 resistance (thick straight line) before but failed. Additionally, the asset broke out of the three-month descending triangle (trendline) presenting a major bullish signal.
Can This Pump Be Trusted?
No.
The whole instapump reeks of price manipulation from smart money. In a time when major crypto companies are filing for bankruptcy, it is highly suspicious that Bitcoin price decides to move up.
Let us not forget the liquidity hunt zones. If this rally is a run on liquidity, then the liquidations will be of epic proportions. Smart money needs to collect all the liquidity on the buy side before crashing the price. This could be the last rally before the megadump to $8,000.
Investors should be cautious of this move. Billionaires are calling a crypto crash at the end of January. While the information is not verified, they could have some insider information since they are also smart money.
A wise man will heed the warning and prepares accordingly. It might seem insane, calling bear moves while the market is green but the best traders SELL GREEN and BUY GREEN. The situation on the Barry Silbert is still developing and it might be the catalyst that finally plunges the markets into chaos.
Brace yourselves.
DISCLAIMER: The work included in this article is based on current events, technical charts, company news releases, and the author’s opinions. It may contain errors, and you shouldn’t make any investment decisions based solely on what you read here.