Prominent trader Capo, who has maintained a bearish stance throughout 2022, continues to hold onto his negative outlook despite recent market rallies. Despite seeing Bitcoin, Ethereum, and many altcoins surge in the past week, with Bitcoin up 21% and Ethereum up 23%, Capo believes that another downward trend is on the horizon. He specifically points out that Bitcoin has been unsuccessful in breaking its critical resistance between $21,000 to $22,000, indicating that the bullish momentum may not be sustainable for long.
Capo emphasizes that the market bounce is not enough to change his bearish perspective, as major resistance levels are still being tested. He highlights the need for a weekly close to confirm any bullish signals, but currently sees no signs of a trend reversal. Capo predicts that new lows are likely for Bitcoin and other major cryptocurrencies, reinforcing his bearish sentiment with a target of $600 for Ethereum. His cautious approach suggests that investors should exercise caution and remain vigilant in the face of market volatility.
In addition to cryptocurrency markets, Capo also notes weaknesses in traditional stock markets, citing the S&P 500’s formation of repetitive lower highs. He predicts that the upcoming earnings season may not be favorable for major companies listed in the index, further supporting his bearish outlook for both crypto and traditional markets. Capo’s analysis points to a potential 22% drop in the S&P 500, which closed on Friday at 3,999 points, indicating significant downside risks in the near future.
Overall, Capo’s warnings serve as a reminder for investors to consider both technical and fundamental factors in their decision-making process. While recent market rallies may have sparked optimism, it is crucial to remain cautious and assess key resistance levels to determine the sustainability of current trends. By staying informed and updated on market developments, investors can better navigate volatile conditions and protect their portfolios from potential downside risks. As Capo’s insights highlight, remaining vigilant and proactive in risk management is essential in today’s dynamic and ever-changing market environment.
Discussion about this post