A widely followed cryptocurrency analyst believes Bitcoin (BTC), Ethereum (ETH) and altcoins bulls are being set up for a massive trap.
The analyst and trader pseudonymously known as Capo tells his 938,800 followers on the social media platform X that the crypto market looks primed to go up to potentially form a bull trap.
A bull trap is a false signal that indicates that the bearish trend is over but then the price abruptly reverses course and witnesses a deeper drawdown.
According to the pseudonymous analyst, Bitcoin, Ethereum and altcoins could rally by between 10% and 50% from current levels before a rapid price reversal.
“Bitcoin to $100,000 with a quick pump, Ethereum to $3,000, altcoins 10% to 50% up – bull trap soon.”
Bitcoin is trading at $89,290 at time of writing while Ethereum is worth $2,205.
Capo says the bull trap would lead to Bitcoin, Ethereum and altcoins correcting by double-digit percentage points, potentially triggered by a black swan event.
“30% to 60% drop (the second shakeout, possible black swan event) after the bull trap.”
A black swan is a rare and unanticipated event that catalyzes a massive market meltdown. The last Black Swan that crushed the markets was the Covid-19 pandemic.
Looking at the trader’s chart, he seems to predict that Bitcoin will first hit $100,000 only to face rejection and plummet to around $69,000.
But after the massive plunge, he sees Bitcoin soaring to a new all-time high of around $116,000.
The widely followed analyst also says that an “epic” altcoin season would follow the capitulation event.
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