- Ran Neuner acknowledges significant selling pressure but isn’t worried, citing no fundamental changes or catastrophic events affecting Bitcoin.
- He highlights past market cycles where drawdowns were much larger, suggesting the current dip doesn’t signal an end to the bull market.
- Neuner notes that accumulating short positions could lead to a short squeeze, potentially driving Bitcoin prices up as positions close.
The reality is very simple right now, there is a lot of selling pressure on Bitcoin.
Ran NeunerCryptomanran, better known as Ran Neuner from YouTube show Crypto Banter, says Bitcoin support has just been broken. This could very well mean the end of the bull market, or is that a premature call?
Related: 10x Research Predicts Bitcoin Price Crash to $50K
Well, Neuner says he is not too fazed.
But I’m going to show you today why I’m not that worried about it. I’m not actually that worried about it.
Ran NeunerHe says despite the technical breakdowns and selling pressures, to him there is a lack of real concern, suggesting a deeper confidence or different perspective on market movements. Neuner added that ultimately Bitcoin is not broken, nothing has fundamentally changed and there is no big negative event like FTX and the Luna crash of past cycles.
Past Drawdowns Dwarf the Recent Dip, According to Crypto Banter
Of course, he also acknowledged that the recent dip was caused by Mt. Gox pressure, the German government’s BTC transfers, and a lack of ETF inflows. But that doesn’t spell the end of the bull market for Neuner.
Let me just show you a few reasons why I’m not worried about this capitulation.
Ran NeunerBanter points toward the past cycles when drawdowns had been substantially larger than the recent one we just saw.
All Shorts Must Eventually be Closed
And, don’t forget the short sellers. Neuner added that while current selling pressure is high, it might lead to a potential short squeeze, where prices could rebound sharply as traders rush to cover bearish bets.
This selling is actually good selling now because the more the shorts build up, remember all shorts have to be closed.
Ran NeunerNeuner, who is a self-proclaimed CNBC Crypto Trader, is right of course. The necessity to close short positions is a combination of needing to fulfill contractual obligations, manage financial risk, and adhere to regulatory standards.
In financial markets, a “short” position involves borrowing an asset, such as Bitcoin, and selling it at the current market price with the expectation that the price will decrease. The trader then aims to buy back the same amount of the asset at a lower price, return the borrowed amount, and pocket the difference as profit.
Related: Startup Hamilton Pioneers Tokenisation of US Treasury Bills Using Bitcoin
While no formal rules exist about how long a short sale can be open, eventually the underlying asset or share needs to be returned.
Credit: Source link
