A preferred dealer recognized for staying steadily bearish all through 2022 says the newest rallies imply nothing and one other leg down is imminent.
Pseudonymous dealer Capo tells his 703,000 Twitter followers that his bearish outlook hasn’t been invalidated by the market’s huge bounce, which has seen Bitcoin (BTC) rally 21%, Ethereum (ETH) 23% and plenty of altcoins explode 30% or extra previously seven days.
In keeping with Capo, BTC continues to be unsuccessful in breaking its most important resistance across the $21,000 to $22,000 space.
“Market is bouncing greater than anticipated. That may be a certainty. Now… is the bearish situation invalidated?
I’m going to clarify why I feel new lows are nonetheless doubtless…
BTC continues to be testing main resistance. Weekly shut will likely be key, however there’s no bullish affirmation but.”
Capo says that related resistance is current within the charts of Ethereum, the full crypto market cap (TOTAL) and the full altcoin market cap (OTHERS). He doubles down on bearish value targets for all devices, together with $600 for ETH.
“That is additionally clear on ETH, TOTAL and OTHERS.”
The buying and selling veteran additionally sees weak spot within the inventory market, which has principally held a directional correlation with cryptocurrencies over the previous a number of years. He says that the S&P 500 is forming repetitive decrease highs and predicts that this quarter’s incomes season doesn’t prove so effectively for many huge corporations listed within the index.
“Conventional markets downtrend is unbroken too. SPX retains forming decrease highs on a regular basis and incomes session is predicted to be dangerous.”
Capo’s chart suggests a few 22% drop within the S&P 500, which closed on Friday at 3,999 factors.
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