Popular analyst Justin Bennett predicts major liquidations before Bitcoin really starts its price rises. He therefore thinks that certain bulls will have a hard time before Bitcoin sets off to new all-time highs.
Liquidations coming?
Liquidations often occur when people play in large numbers with borrowed money, and the Bitcoin price then starts to move in the opposite direction. If you take out a loan to buy Bitcoin, and the price then drops 20%, that is of course a bit of a shock.
That is exactly what Justin Bennett now seems to be predicting for a large group of bulls. In the event of a liquidation, they would then have to sell their Bitcoin to pay their debts.
This could cause the price to drop even harder.
Based on the current liquidity distribution, Bennett expects Bitcoin’s price to fall to $57,000 and perhaps further.
“The size of the Bitcoin long liquidations at $57,000 is much larger than the shorts liquidated at $63,000. It would be a shame if Bitcoin knocks this out before the real increases start. Especially since I am once again being an idiot for suggesting that we stay in the range where the market has been for the past seven months,” said Bennett.
Need to raise some liquidity?
In technical analysis, they call such declines “liquidity retrieval.” According to Bennett, the liquidity would therefore be around $57,000. After that, based on his chart, he sees an opportunity for Bitcoin to recover and climb again.
At the end of September he predicted that a drop to $57,000 would be followed by a major rally to $70,000. At the time of writing, this is not yet the case, but Bitcoin is struggling at the level of 62,000 dollars.
In that respect, there will be more and more bulls who give up hope and that could possibly give the bears the upper hand in the market.
Source: https://newsbit.nl/trader-voorziet-grote-liquidaties-voor-echte-koersexplosie-bitcoin/
