A closely-followed crypto strategist whose credibility in the crypto space rose after nailing Bitcoin’s collapse in March 2020 says he expects BTC to bottom out and print a new all-time high in the coming weeks.
In a new tweetstorm, the analyst known in the industry as Capo looks at a number of technical indicators to show why he believes Bitcoin has carved a bottom.
The trader explains that the steep decline in Bitcoin’s open interest, which refers to the number of contracts held by market participants, is bullish for the leading cryptocurrency,
“Same as the other time (January drop), open interest (OI) has dropped with the price. Late longs got rekt. This drop on the OI due to late longs liquidations mostly, has helped the funding rates to reset. Also, shorts are trapped. They think price hasn’t reached its bottom, so they are shorting the bounce, causing the funding to tend to be negative (bullish).”
Capo also highlights that a concealed divergence on both the Ethereum and Bitcoin charts between the assets’ relative strength index (RSI) and price may indicate that momentum is swinging to the side of the bulls.
“BTC and ETH RSI is forming hidden bullish divergences again, on the high timeframes. This divergence means trend continuation when confirmed. Pivot (invalidation) for BTC: weekly candle close below $33,000. Confirmation for BTC: weekly close above $57,000.”
In addition, the crypto analyst notes that whales are buying the BTC dip, suggesting that the largest crypto holders are building a new base for the next leg up.
“Institutions/whales keep accumulating at these levels. Coinbase Pro outflows going up like crazy.”
With Bitcoin gearing up for the next phase of the bull cycle, Capo believes that the leading crypto asset will skyrocket to a new all-time high of around $80,000 before the end of March.
“BTC new potential range between $60,000 and $42,000. Target after consolidation above the range high: about $80,000.”
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Featured Image: Shutterstock/Tithi Luadthong
