The crypto strategist and trader who grew his following after accurately nailing Bitcoin’s 2018 bear market bottom is issuing a warning to altcoin investors.
In a new tweet, pseudonymous trader Smart Contracter tells his 94,800 followers that he’s derisking his crypto portfolio as the Bitcoin Dominance index is showing signs that it will pull off a strong rally, suggesting the possibility of a deep correction across the altcoin markets in the coming weeks.
“Took profit on a whole bunch of altcoins, despite how much I love them. I think BTC dominance is going to have a big fuck off bounce from here and wreck them all. I’m really not sure at the moment whether this will be due to alts falling more than BTC or whether BTC pumps hard and fucks alts.”
Traders rely on the Bitcoin dominance index to predict whether Bitcoin will outperform altcoins and vice versa. A bullish index is usually not a good sign for the altcoin markets as it indicates that alts may bleed or Bitcoin may surge faster than other tokens.
The trader’s optimistic mid-term outlook on the Bitcoin Dominance index comes as he continues to be bullish on the leading crypto asset. In March 2020, when Bitcoin nosedived below $4,000 amid the Covid-19-induced panic, Smart Contracter said that BTC would eventually recover and skyrocket to $50,000. Today, Bitcoin is trading above $47,500, which is a little over 5% away from his target.
Meanwhile, fellow analyst Michaël van de Poppe is mapping out the key levels for Bitcoin. He says the critical level to hold for the flagship crypto asset is support around $43,000. A move below that range would indicate a deeper retracement to $37,000. Should BTC hold the $43,000 level, he expects the largest crypto asset to surge to a new all-time high.
“In a bullish case, if we hold $43,000 and start grinding up, you know that the next target zone is around $60,000 to $63,000.”
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