In a new interview with CNBC’s Ran NeuNer, crypto analyst Jake Canfield, co-founder of Signal Profits and former US Army veteran who spent six years doing counterintelligence and cryptography, says crypto traders should avoid buying altcoins until Bitcoin shows some stability.
“The altcoin run that everybody knows and loves – Ethereum, Ripple, all those things – was three weeks long. And so it’s a very, very short window. Liquidity moves into major market caps, into mid caps, into small caps and then into shitcoins. So the money moves downwards. So, we can see a bull run and an alt season and the multipliers are going to be great because altcoins have just been bleeding the last two months just nonstop. And so once we do reach a bottom, once we do reach reversals, we’re going to see huge gains off of altcoins if and when we see that bottom happen.
And I would recommend and advise anybody trading: wait for a reversal confirmation. Don’t try and catch these knives all the way down. Just wait for Bitcoin to find some stability. That’s what altcoins need right now. Because Bitcoin pumps, altcoins die. Bitcoin drops, altcoins die some more. So right now, just wait for the reversals to happen before going into any altcoins. Just wait for confirmation, and what I mean by confirmation is wait for a higher high and a higher low. Right now, all we’re getting are lower lows, lower highs.”
Canfield says big traders are currently buying small dips as traders trying to short the market get liquidated.
“Traders are buying the dip. And the dips aren’t very big. They’re very small, shallow pullbacks. A lot of traders are trying to short the market before we break out, and that’s actually giving fuel to the fire for Bitcoin right now. Everybody keeps trying to short the market, and they keep getting liquidated, and it keeps pushing the price higher and higher because they keep getting underwater. So they’re forced to close, and also the funding rates on these exchanges is atrocious. So people trying to open a short position, they just have to close them and they’re closing them at higher prices and it’s just continuing to propel the price higher. So most of the high-level traders, they’re just buying the pullbacks at this point.”
As for Bitcoin’s trajectory, Canfield says there’s no doubt we are now in a bull market.
“Yes. And there’s a lot of reasons why. I would definitely point people to read Tuur Demeester’s recent report on Bitcoin accumulation. But also, just simple indicators. Back in 2015, there was a moving average known as the 200-day moving average on the weekly chart. And then the 50-period moving average, which rejected the price of Bitcoin several times as we fell through that. Once Bitcoin broke up through that, that’s when we started that bull trend. And right now, Bitcoin broke through the 50-day moving average on the weekly chart, and that’s been the classic bull market for Bitcoin since 2010.”
Right now, the crypto markets are mostly in the green. Bitcoin is up 5.73% at $6,363, according to Coin360. Ethereum is up 5.19% at $174.86, and XRP is up 1.51% at $0.2981.
Technical analysts at large are looking for Bitcoin to break $6,500 as altcoins try to keep pace.
FXStreet – ETH/USD poised for further recovery
Coinspeaker – XRP/USD price may Reverse at $0.28 level
Ethereum World News – Litecoin formed a strong support near the $72.00 level