A cryptocurrency analyst and trader warns that one event could cause Bitcoin (BTC) to collapse by double digits.
The analyst, pseudonymously known as DonAlt, tells 56,200 subscribers of the TechnicalRoundup YouTube channel that if the U.S. Securities and Exchange Commission (SEC) refuses to approve a spot Bitcoin exchange-traded fund (ETF), BTC could fall by about 37% decrease compared to the current level. .
“We can talk about what happens when we get a denial. It’s quite simple for me. I think this would at least undermine this consolidation [from around $33,000 – $38,000]if not the origin of the movement taking place down here [around $24,000].
So if the ETF is rejected, the market structure here was actually not that favorable [just above $24,000] and the reason why, in my opinion, it went from $27,000 to $28,000 was actually almost entirely the ETF.
So if we get a denial, we return to that area. So that’s the worst case: denial puts us at $27,000, $28,000.”
Bitcoin is trading at $42,796 at the time of writing.
The pseudonymous analyst also says that the approval of spot Bitcoin ETF in the US could also have a bearish impact on BTC.
“An endorsement, a lot of people would say, ‘Hey, an endorsement has to be very bullish.’ I would say we have a lot of it priced in, but in the short term this could lead to some upside.
But I think if you get approval, you might get a spike upwards. I’m not even so sure about that anymore. But you could get a spike to the top that a lot of people would sell to.
And I think that would also take us a little bit lower… Just move down a little bit towards $38,000, and then creep back above $40,000.”
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