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For the trader, the decline prepares the ground for the next bullish stage.
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“The Cryptocurrency market could not be better positioned,” says Melker.
The price of Bitcoin (BTC), which three days ago reached a new all-time high above USD 108,000, fell today to USD 92,000. And, although it later recovered slightly, it raises questions about how it will continue in the short term.
“The bullish cycle is over. If you didn’t sell at the peak or are not selling now, prepare for a bear market. Expect at least two years of pain, lower lows, 90% drops and maybe another 90% more,” popular trader Scott Melker, better known online as The Wolf of all the Streets, joked about it.
Continuing with the joke, the trader said: “there is bad news on the horizon, which brings terror for altcoins and relentless doubts for bitcoin.” This is how he introduced his daily report on the cryptoasset market sent by mail on December 20, which CriptoNoticias was able to access.
Anyway, “if any of that pessimism and despair resonated with you, or if those thoughts are running through your mind, I have news for you: you probably won’t be able to overcome this cycle,” the specialist continued. Melker specified that bitcoin price pullbacks of 10% to 25% are typical in a bull market.
The fall he experienced bitcoin since the recent new price record was almost 15%. Meanwhile, Ethereum-eth/” target=”_blank” rel=”noreferrer noopener”>ether (ETH) saw a 22% correction from its weekly high, while other altcoins saw steeper declines as usual.
“While these types of setbacks are not for the faint of heart, they are not a cause for panic either: it is standard behavior,” the trader stressed. With this, he tried to call for calm to investors so that Don’t discuss impulsive sales and instead reanalyze your strategy.
“I’m not saying you have to look at your investment portfolio and be happy: this is a tough market and we’re all human. But staying calm and focused is what separates the winners from the losers.”
Scott Melker, trader specializing in the bitcoin and altcoins market.
Cryptocurrency panic selling may indicate overexposure
According to the specialist, an investor’s panic sales usually indicate overexposure in relation to their convictions. “If you are questioning your investments, it is time to rethink and rebalance them,” he clarified.
To do this, he recommended asking yourself the following: Has anything fundamental changed in cryptocurrencies in the last three days? Or even in the last 24 hours?
According to their perspective, what has happened is a cut in interest rates expected from the Federal Reserve (Fed), a slightly aggressive tone of Jerome Powell, its president, and a significant drop in traditional markets.
“I’m racking my brain for a specific legitimate concern for cryptocurrency investors and I honestly can’t find any,” he said.
Yes ok Powell stated that are not authorized to have bitcoin“the fact that it is even being talked about is incredibly optimistic for the long term,” he added. In any case, he sees it possible that there have been bullish exaggerations that overlooked the slowness with which the bureaucracy moves or Donald Trump’s lack of specificity on the issue.
For Melker, “the cryptocurrency market could not be better positioned.” “We are about to have a new SEC commissioner, a pro-cryptocurrency president, a pro-cryptocurrency Treasury secretary, a government department called DOGE, and a cryptocurrency czar,” he listed.
“Does it really seem likely that everything is over just because bitcoin was sold along with traditional markets?” the trader questioned. Far from it, he highlighted that the falls occur during a bullish streak, at random and unexpected moments, to test and punish those who have a weak conviction.
The specialist maintains that These pullbacks are healthy resets as they eliminate panicked sellers and give the market a new boost. In this way, he warns that “they prepare the ground for the next bullish stage.”
Bitcoin has largely remained above $100,000 so far in December and many altcoins have shown positive signs. “Take a moment to reflect on where we started, how far we have come, and what is possible in the coming year,” Melker stressed.
BTC-USD price so far in December. Fountain: TradingView.
With this in mind, he remembered that predicting falls is impossible, but what matters is how you react to them.
Regarding the technical analysis of the price, it stands out that, with the fall, bitcoin has managed to stay above the moving average 50 days. This is at USD 92,000.
If it loses this level, the next logical support is seen around USD 89,000 and then USD 73,000. Even with such a drop, it does not see the bullish cycle eradicated, but rather a test of strong psychological levels.
In the event that the demand is reactivated, sees a recovery of bitcoin to USD 99,000 imminent with increasing volume pointing to a new test of USD 108,000 and a possible continuation.
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