Long Time Bitcoin Analyst Talks How a Significant Price Action Wave Could Start Soon
A quick look at Coinmarketcap shows us that Bitcoin shorts seem to be currently hovering around their monthly highs. This seems to suggest that investor confidence in the flagship cryptocoin is once again waning or atleast beginning to drop gradually.
With that being said, it should be remembered that ‘shorts’ are quite an “unconvincing indicator of investor sentiment” since the opinions of different analysts on the impact of short contracts (in relation to the price of BTC) varies quite substantially from individual to individual.
This stance has been echoed by a number of established independent traders and analysts (such as ‘Haska’), who believe that shorts do not always paint an accurate picture of what the investor sentiment towards a particular market is truly like.
More on the Matter
As many of our readers are probably well aware of, most investors currently associate shorts with an outright “negative POV” — since these contracts seem to suggest that a particular commodity will drop in value within a short period of time.
However, when talking about shorts from the perspective of Bitcoin, we can see that a rise in shorts often is seen as an opportunity for investors to “close out their existing positions and add to the upward pressure being witnessed by a particular stock commodity.”
In regards to the matter, Hsaka stated that shorts are frequently employed by traders as being niche’ market indicators, however, they are not good at portraying what the future might have in store for a particular asset.
On the subject, he then added:
“To be honest, I try not to look at the short or longs narrative too much. It seems like reading tea leaves to me. One can skewer the interpretation to fit his or her own bias.
We’ve seen this happen a lot of times before. Shorts breach ATH, everyone starts talking about a mega squeeze causing a massive BTC pump. The pump never arrives and shorts gradually normalise.”
Why Is This Happening?
The growth in the number of the aforementioned short contracts could have possibly happened due to the “rising uncertainty in the short-term performance of Bitcoin”. To elaborate further on the matter, we can see that last time when BTC experienced such prolonged stability, the premier asset was faced with a massive drop in its value shortly thereafter. Similarly, last November, after experiencing months of support around the $6K area, Bitcoin plunged to new lows— even dipping to a price point of $3,122 within a matter of some 30 odd days.
What Might the Future Hold for Bitcoin?
At this point in the article it is worth pointing out that over the course of the last few weeks, many alt-currencies such as IXEC RLC and Zcoin have witnessed record-breaking single-day gains (in the range of 40 to 70 percent) against the US Dollar as well as Bitcoin.
Being the alpha of the crypto domain, BTC still dominates the macro landscape of this industry— so much so that many analysts believe that if the flagship cryptocoin is not able to move past its key resistance level of $4,000, a host of other top altcoins could suffer financially as well.
This is the range I'm currently watching.
The only reason why I think BTC is important right now is that I expect a big altcoin dump the moment BTC starts making bigger moves.
Altcoins are safe as long as BTC stays lethargic.
I don't expect that to last though. pic.twitter.com/ZkAPhpQzS9
— DonAlt (@CryptoDonAlt) March 11, 2019
With that being said, if BTC is able to regain its former momentum and surge once again in the near future, Hsaka added that more and more altcoins in the top-50 will be able to experience rapid price movements:
“Very bullish on alternative cryptocurrencies today, many breaking out of months long falling wedge patterns. But what I’m watching carefully is what Bitcoin does when it confronts the year+ long resistance trend line. If we break out, the real alt season begins. If not, the alternative cryptocurrency party ends,”