A couple of closely followed crypto strategists are mapping out what’s ahead for Bitcoin after BTC’s strong move from $35,000 to $40,000 in just 48 hours.
Pseudonymous crypto analyst Credible tells his 311,800 Twitter that an “aggressive short squeeze” was the catalyst behind Bitcoin’s heavy bounce in the last two days.
“Got an aggressive short squeeze yesterday. Not sure if it will hold but if it does, resistance at $42,000. If we retrace the squeeze, then in my opinion we bottom between $29,000-$32,000 as per my last post. At any point, a high timeframe close above monthly resistance indicates confirmation of a bottom.”
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.
In the case of Bitcoin, traders were betting that BTC would break $35,000 following Russia’s announcement of its military action against Ukraine. Instead, the king crypto rallied, forcing traders who were short on BTC to buy over $300 million worth of Bitcoin on February 24th, fueling the rally (short squeeze) to $40,000 on February 26th.
With Bitcoin managing to hold support at $35,000, fellow crypto analyst Smart Contracter tells his 205,200 Twitter followers that BTC has now established a short-term range between $35,000 and $44,000.
“Really big BTC reversal candle today. Not sure if bottom or not but this should be a tradeable range for a little bit.”
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