Altcoins have seen a surge of relief as Terra’s initial panic sparked by the UST collapse and multiple stablecoins losing their dollar pegs began to dwindle and risk-loving investors sought to rally their asset trading to year lows. The next move of Bitcoin (BTC), which leads the market on a large scale, began to be curious. Here are the next levels in BTC according to analysts…
The expectation of short squeeze in Bitcoin
As we reported on Cryptokoin.com , the events that occurred last week. Despite the significant correction, Bitcoin (BTC) bulls have managed to bounce back into the $30,000 zone, which was defended repeatedly throughout the 2021 bull market. Traders drew attention to various metrics as the price struggled to recover against multiple headwinds. Data for derivatives traders was provided by Coinalyze, a cryptocurrency analysis platform that evaluates Bitcoin long and short positions for BTC/USD perpetual contracts on ByBit.
As shown in the lower half of the above chart, short positions (shorts) in red increased during the last market decline, suggesting that derivatives traders are expecting further declines in the short term. “Market sentiment has been very negative over the past few days, as seen by the ByBit long/short position ratio and funding rate,” said Gabriel Dodan, founder of Coinalyze. A short squeeze is expected,” he said.
A short-term rise to $35,000 is expected for Bitcoin
According to David Lifchitz, managing partner and chief investment officer of ExoAlpha, Bitcoin will launch on May 12. The drop to $26,716 was notable as it dropped below the May 2021 low of $28,600. In Lifchitz’s view, the rebound seen on May 13 was expected because of “a lot of bad news emerged” and “the panic that resulted from the IHR debacle”. According to Lifchitz, “with a tight stance this point could be a good entry point if the cleanup continues” for Bitcoin, which is standing at May 2021 lows.
However, traders should not expect an overnight return to $60,000 and instead set a more modest short-term target. A target of $35,000 is reasonable, according to the analyst. Lifchitz used the following statements:
Long position: $28.5k / Stop level: $26.5k / Profit target: $34.5k, ie $6,000 up / $2k down = 3/1 gain- From a loss rate and investment standpoint, it looks attractive to me.
Can a V-shaped improvement be seen?
Analysis on what it would take for Bitcoin to regain its bullish momentum was provided by market analyst “Rekt Capital”. While many optimistic traders were hoping for a quick recovery from this latest setback, Rekt Capital warned that “by the standards of history, a sharp V-Shaped rebound that will mark a generational low is less likely.” “Many are anticipating a rebound as the previous March 2020 BTC bear market bottom was so volatile. But the macro price history shows that extended ranges are more likely.”
