A popular analyst says the implosion of crypto exchange FTX could be the signal that marks the beginning of the end of Bitcoin’s (BTC) bear market.
Pseudonymous analyst Rekt tells his 329,900 Twitter followers that this is not the first time a prominent crypto exchange has blown up during the height of a bear market.
Rekt says that historically, the collapse of a crypto exchange suggests that the Bitcoin bear cycle is close to its conclusion.
“In previous BTC cycles, it was BitMEX, earlier it was Mt Gox.
Now FTX.
It’s a pattern.
Exchange contagion has become a historical tendency that occurs close to the absolute BTC bear market bottom.
Survive the capitulation and you will flourish in the bull market.”
The crypto strategist is also counting the days before the next Bitcoin halving, an event where rewards issued to BTC miners are cut in half. According to Rekt, historical data also suggests that BTC close to carving a bottom.
“Historically, BTC tends to bottom 517-547 days prior to the next halving event.
The next halving is 536 days away.”
In terms of the magnitude of the current cycle’s drawdown, Rekt highlights that BTC is close to its typical 80% bear market correction.
“Technically, a BTC bear market correction of -80% was bound to happen
One could argue that catalysts of the [Ukraine-Russia] war, LUNA, Three Arrows Capital, FTX and others were what facilitated this current -78% retracement
Positive catalysts will magically appear at the BTC bottom as well.”
As for his bottom target for Bitcoin, Rekt says that he’s looking at $13,900.
“If BTC turns the recently broken ~17,400 monthly support into new resistance,
then BTC could even reject towards the next immediate monthly support of ~$13,900.
Should that happen, BTC will have retraced -80% from the $69,000 highs.”
At time of writing, Bitcoin is changing hands for $16,736, down nearly 1.25% on the day.
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