Cryptocurrency markets have witnessed substantial gains in the past year, with Bitcoin and Ethereum leading the charge. However, amid this bullish momentum, a prominent trader known as “Il Capo of Crypto” has issued a cautious warning, suggesting that the current crypto bull market may be on the brink of a significant correction.
End of the bull run?
Il Capo, who has maintained a steadfast $12,000 price target for Bitcoin throughout the year, recently made a notable declaration on December 22nd, indicating what could be perceived as the end of the current bull market. Despite Bitcoin’s impressive 163% year-to-date surge and Ethereum‘s 92% gain, Il Capo remains skeptical about the ongoing rally.
According to Il Capo, BTC/USD is potentially “forming a local top” in the range of $40,000 to $45,000, and Ethereum (ETH) might experience a drop into the $2,500 range. Furthermore, some altcoins could witness their final upward movements before a reversal that could lead to new lows in the coming weeks.
Il Capo’s bearish outlook coincides with a critical event in Bitcoin’s history—the impending approval of the first Bitcoin spot price exchange-traded fund (ETF) in the United States. Many industry experts consider this approval to be a potential game-changer, as it could pave the way for significant institutional capital to flow into Bitcoin.
A widely-discussed BTC price target of $48,000 associated with the ETF decision, expected by January 10, 2023, has generated substantial market anticipation. Il Capo’s skepticism seems to diverge from the overall bullish sentiment prevailing in the market, especially in light of this upcoming milestone.
Mixed sentiments in the market
It’s worth noting that Il Capo had previously hinted at the “beginning of the end” in November and expressed concerns about prices rising higher than expected, fueled by an extremely bullish sentiment in the market. However, it’s essential to acknowledge that various experts have diverse opinions on the potential outcome.
Some market observers see the possibility of a significant correction even if the Bitcoin ETF is approved. They view such a correction as a potentially healthy catalyst for the continuation of the bull market.
Trading firm QCP Capital, in its final market update for 2023, speculated on a “sell the news” scenario unfolding in the second week of January. This scenario could lead to BTC encountering resistance in the 45-48.5k range and a possible retracement to the 36k level before the uptrend resumes.
Long-term confidence remains
Despite short-term uncertainties and differing opinions within the crypto community, there is an underlying confidence that the long-term upward trend in cryptocurrencies will eventually prevail. Market participants are positioning themselves for a strong rally, particularly in anticipation of the Bitcoin halving, even if it necessitates a brief period of market adjustment.
As Il Capo of Crypto maintains a bearish perspective, the crypto community is closely watching these pivotal events unfold to determine the future direction of the market.
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