dailyhodl.com
A widely followed crypto analyst is issuing an alert about Bitcoin ($BTC), saying that the top digital asset could collapse if one key level breaks down.
In a new strategy session, crypto trader Justin Bennett tells his 113,900 followers on the social media platform X that Bitcoin could plunge more than 8% from its current value.
Bennett uses the whale versus retail delta indicator (WRD), which gauges whether whales or retail traders are more bullish. A higher value means more whales are longer Bitcoin than retail traders.
The declining WRD value is bearish Bitcoin since whales tend to be a better predictor of the market direction.
“Given everything I’m seeing, a pullback from $BTC into $69,300-$70,000 seems likely. From there, bulls must hold the line into the daily/monthly close. If they can, things remain constructive. If they can’t, $65,000 is next. I’m not ruling out a $73,000 intraday sweep first to clear those equal highs, but Bitcoin pumping at the NY (New York stock exchange) open has been a bearish signal all month. Let’s see.”
Bennett also believes that a market correction in the near term is more likely than a bullish continuation due to the trading volume metric.
“If this $BTC breakout is the one to trigger $100,000-plus, why is it stalling? Why is volume not at multi-year highs? Bitcoin has been sideways for seven months! That alone should trigger consecutive +5% days or better and massive volume. But it isn’t. Why?”
He also says that Tether ($USDT) stablecoin’s market cap relative to other cryptocurrencies may continue to increase, a bearish signal for Bitcoin.
He shares a chart of $USDT Dominance ($USDT.D) that appears to predict it will gain more market share in the near term.
“Tether dominance. It moves inversely to $BTC, so add it to the other clues I’ve shared. A daily close above this level is bearish for Bitcoin.”
Lastly, he warns of market volatility due to upcoming events.
“[October 31st] is the last day of October, and early next week is the US presidential election. Not to mention Friday’s NFP (Non-farm payrolls data). Don’t get too comfy with any assumptions.”
Bitcoin is trading for $70,725 at time of writing, down 1.6% in the last 24 hours.
Generated Image: Midjourney