Bitcoin’s strong surge to kick off 2020 has caught many traders on the back foot. Case in point: each leg higher in the price of BTC has been marked by dozens of millions of dollars worth of short liquidations on margin trading platforms like BitMEX.
While the majority seem to have been caught off guard, one trader called Bitcoin’s emerging uptrend: Financial Survivalism, also known as Sawcruhteez.
Just a day after New Year’s Day, the prominent trader claimed that Bitcoin was starting to show signs it was forming a textbook Wyckoff Spring pattern. The pattern, Sawcruhteez suggested, implied BTC was going to hit $9,200 in the middle of January.
— Tyler D. Coates (@Sawcruhteez) January 2, 2020
And that it did. By January 17th and 18th, the leading cryptocurrency had passed above the key psychological and technical resistance of $9,000.
Now, Sawcruhteez is warning of a potential retracement, which should be a potent caution considering his track record.
Bitcoin Could Soon See Retracement, Analysts Suggest
Today Sawcruhteez pointed out that for the trading session of Thursday, the ongoing one-day, two-day, and five-day candles are all printing green 9s, according to the Tom Demark Sequential, a time-based indicator that issues 9 and 13 candles at reversal points.
The combination of green 9s on three key timeframes, Sawcruhteez wrote, might be a primer for a “correction,” for it would suggest that the short-term bull trend has been thoroughly exhausted.
— Tyler D. Coates (@Sawcruhteez) February 13, 2020
It isn’t only the confluence of the TD Sequential printing 9s across time frames that has analysts concerned.
Thomas Thorntown of Hedge Fund Telemetry recently pointed out that per his Demark Sequential Countdown, which called Bitcoin’s $6,400 bottom, the indicator is printing a potential sell candle, meaning investors should be cautious.
This is notable: the indicator printed a 13 candle when Bitcoin hit $20,000 in December 2017, when BTC cratered to $3,150 on December 14th of 2018, and at the $14,000 top in June of 2019.
Also, extremely profitable cryptocurrency whale J0e007 (Joe), who took $14.4 million worth of profits in December 2019 and nearly $7 million in the last month alone, recently warned that Bitcoin could soon be in for a crash so big that the “whole crypto space is essentially wiped out,” not just a small retracement as some expect.
He backed this strong assertion by looking to fiat inflows into the crypto market (or lack thereof), noting that the Tether’s flatlining market capitalization is “hard to explain from a position that we’re in the middle of a new bull market” and that Grayscale’s inflow data doesn’t convince him there is enough demand to absorb the mined supply.
What Do Bulls Have to Say?
Despite all this, many bulls remain resolute in their stance that Bitcoin remains in an uptrend that will not see significant pullbacks, at least for now.
Sawcruhteez recently noted that the three-day Ichimoku Cloud for Bitcoin is now “fully bullish,” with prices breaking through the cloud resistance and with the future cloud twisting positive. The indicator signaled a buy at $10,268, suggesting more upside is imminent.
— Tyler D. Coates (@Sawcruhteez) February 12, 2020
And Dave the Wave, the trader who in the middle of 2019 said the price of BTC would retrace to the mid-$6,000s, just doubled down on his prediction the asset will hit $11,000 to $11,500 before any significant pullback, if at all.
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