Bitcoin remains on the verge of a really devastating decline. Like always, most retail traders would not realize it until it’s too late. All the temporary bullishness in the stock market and Wall Street’s reaction to Moderna’s work on the vaccine gave the stakeholders in this market to delay the inevitable a bit but they cannot stall it for long. There’s a huge honeypot of long positions that is too lucrative for the market makers and whales to ignore and not take advantage of. Going long on the market at this point makes no sense at all from a risk/reward standpoint.
It has become quite obvious that they just keep pumping BTC/USD higher every time it gets ready to keel over. However, soon as we have a major move in the stock market, we are going to see the same in the cryptocurrency market. More important than that, we have recently seen how a crash in gold led to a crash in Bitcoin. If XAU/USD breaks below the rising wedge this time, we could see an even more devastating decline in Bitcoin and other cryptocurrencies this time.
The S&P 500 (SPX) has repeatedly failed to effectively break past the 61.8% and begin a new uptrend. It has once again revisited that level but it is clear that there is not enough bullish momentum for further upside. All that is happening at this point is an attempt to shake out the bears and trap in more bulls before the major decline kicks in. For both the stock market and the cryptocurrency market, the stakes are higher this time as the decline is going to be more aggressive. The EUR/USD forex pair has also reached the top of a key symmetrical triangle and now risks a major trend reversal. All of these factors put together coupled with worsening economic situation because of the pandemic make it clear that there is more to worry about than an all-time high in Bitcoin.