The crypto analyst and trader who accurately called Bitcoin’s top just under $65,000 in May is now laying out his worst-case scenario for BTC.
The pseudonymous trader, known as Dave the Wave, tells his 77,700 followers that Bitcoin’s current price action looks similar to 2014, where the leading crypto asset plunged from around $988 down to about $160.
“While some have compared the PA (price action) to 2013, a comparison to 2014 is also of interest. If you find the chart alarming, remind yourself:
1] This is just TA (technical analysis)
2] You could consider it stress-test/ risk management of sorts.
And that would be my *worst case* scenario.”
Bitcoin is trading at $43,145.41 at time of writing and is down more than 16% in the past two weeks, according to CoinGecko. Dave the Wave’s charts indicate he sees the largest crypto asset by market cap dropping to a short-term target of $37,500.
The trader also expresses doubt about “the golden cross,” a technical event seen by many traders as a sign indicating future rallies.
“Why is the golden cross problematic? Because the 50 day cross of the 200 could just be too short a time reference/ preference.”
Dave the Wave adds he doesn’t think the correction will necessarily cause Bitcoin’s price to have a massive spike downwards to where the leading crypto asset might revisit prices below $20,000.
“Just as you didn’t see a blow-off top, you might not see that massive capitulation spike down. As with all corrections, people will no doubt be waiting for lower prices that never come. Over and out.”
Featured Image: Shutterstock/Fernando Cortes