A closely-followed pseudonymous trader and crypto analyst says that traders’ gut reaction to Bitcoin’s recent price action might be wrong as the top cryptocurrency nears its monthly close.
In a tweet, DonAlt says the prevailing bearish sentiment for BTC appears to be unwarranted.
“It’s very, very weird seeing sentiment be this bearish, with neutral or negative funding above $10,000. Don’t think I can remember a time where that has happened before.”
The trader explains that the recent BTC pullback is actually a strong bullish signal.
“BTC monthly:
Currently looks like a simple retest of support, as long as we don’t crash in the next couple days, that’s typically bullish.”
The trader also highlights that the number one cryptocurrency has been outperforming traditional assets such as the S&P 500 and gold.
“SPX and GOLD put in a tiny bounce, BTC put in a huge one. Shows you where the strength is (was apparent even before the breakdown, hence my BTC will outperform comment).”
The crypto analyst is also keeping close tabs on Ethereum (ETH). While the second-largest cryptocurrency suffered a major technical breakdown recently, he says its resilience over the last few days makes it more difficult to guess where it is headed in the shorter time frame.
“Honestly surprised by ETH’s strength. The down-move I was expecting played out, but it didn’t fully collapse and found buyers quickly. This is either a neckline retest or the entire down move was a shakeout.”