• A trader who accurately predicted the crypto rally earlier this year is warning that digital assets may collapse if one financial trend occurs.
• The analyst, DonAlt, says he’s keeping a close watch on the performance of the S&P 500 and believes Bitcoin (BTC) and the broader crypto markets will likely suffer a serious correction if the stock market shows signs of bullish exhaustion.
• He also notes that Bitcoin could show some semblance of bullishness if it manages to recover the key psychological level of $30,000.
Market Doldrums Could Lead To “Crypto Nuke”
Analyst DonAlt has issued a warning in light of current market doldrums, stating that one factor could cause cryptocurrencies to experience an extreme decline.
Analysts Examines S&P 500 Performance
DonAlt is paying particular attention to how well the S&P 500 performs in order to gauge where cryptocurrencies may head next. If the stock market displays signs of reaching its peak bullishness, then there is potential for a large correction in Bitcoin (BTC) and other digital assets.
Bitcoin Price Levels To Watch Out For
DonAlt suggests that should BTC manage to reclaim its key psychological level at $30,000 then this could be seen as a sign that bulls have not been completely neutered yet. However, while BTC remains below this mark, DonAlt considers it more bearish than bullish.
Retesting Of Resistance Level
When testing resistance at $29,000 recently, BTC managed to squeeze out some bulls before squeezing out bears which ended with a bearish retest result according to DonAlt. As long as BTC continues closing below $30k then this paints more of a bearish picture than one which points towards any sort of recovery soon.
In conclusion, DonAlt’s analysis suggests that unless BTC reclaims its key psychological price level at $30k then it may continue trending downwards in what he deems as more bearish conditions for now; though he still holds out hope for recovery should it reach these heights again soon enough.