A widely followed crypto analyst is predicting an abrupt rally for a trio of digital assets fueled by short sellers.
Crypto strategist Michaël van de Poppe shares to his 628,000 Twitter followers a tweet by financial researcher Jason Goepfert.
According to Goepfert, retail traders have spent $18 billion on put options and accumulated $46 billion worth of short positions on index futures – both record setting.
Van de Poppe says that the record-setting amount of short positions in the traditional markets is actually a bullish signal.
“Short squeeze incoming.”
A short squeeze happens when traders who borrow units of an asset at a certain price in hopes of selling lower to pocket the difference (short) are forced to buy back as the trade moves against their bias.
With Van de Poppe predicting a rally in the traditional markets, the crypto analyst is expecting Bitcoin (BTC) to follow suit.
“Bitcoin held the crucial area around $18,500 and is now looking to break out of this range.
Another test of $19,500 (probably Monday) and we’ll be good to go.
Crucial barrier to hold: $18,500.”
At time of writing, Bitcoin is changing hands for $18,887.
Next up is Ethereum (ETH), which Van de Poppe says is managing to hold support at $1,200.
“Ethereum still on support, which was previously the resistance area.
Interesting though. It should be holding here and test $1,425-$1,450 area.”
At time of writing, Ethereum is valued at $1,305.
The crypto analyst is also keeping a close watch on decentralized oracle network Chainlink (LINK). According to Van de Poppe, LINK might be due for a short-term pullback before igniting the next leg up.
“Two levels I’d be watching on LINK (and I think we’ll be going towards $12-$15 soon).
Resistance around $8 to be tested would be a scalp short.
Swing longs around $7.”
At time of writing, LINK is trading at $7.77, up over 2% on the day.Don't Miss a Beat – Subscribe to get email alerts delivered directly to your inbox
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