The analyst who correctly called the collapse of Bitcoin this year is warning BTC holders, saying that a royal crypto capitulation event is in sight.
The industry analyst, who goes by the pseudonym Capo, tells his 692,200 Twitter followers that Bitcoin continues to show signs of weakness.
While Bitcoin bulls have managed to ignite the current bear market low near $15,700, Capo says the latest bounce is significantly smaller compared to BTC’s previous rally since June.
“Every jump is smaller. Low lows and low highs. Support becoming resistance. $12,000 is like a magnet.”
At the time of writing, Bitcoin is trading at $16,840. Capo’s move to the $12,000 target indicates a more than 28% drop in the crypto royale.
Capo too says that traders are probably not ready for a sharp drop.
“Just read the comments here and you’ll get the second confirmation (the first being the analysis and indicators) that most people are trapped above $17,000 and can’t take another dip. Like I said before, most people aren’t ready for what’s coming, and it shows.”
He adds that the current trading environment in crypto and the stock market seems to create a “perfect scenario for a proper capitulation.”
“Stock Market Hemorrhage, Altcoins Break Key Support Bases, Indices Down, Bulls Get Euphoric and Confident for Small Pumps.”
Looking at the stock market, Capo says the S&P 500 ( SPX ) remains in a downtrend, respecting its diagonal resistance.
“Pure drop test. Uninterrupted Downtrend”.
Traders are watching the performance of the SPX as the weak reading suggests investors are wary of riskier assets such as stocks and cryptos.
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Featured Image: Shutterstock/Roman Sakhno