There’s a compelling forecast in the air as a renowned crypto trader anticipates a vigorous rise in Bitcoin’s (BTC) value to the $30,000 mark. Inmortal, the pseudonymous analyst suggests that a potent short squeeze could be the primary driver behind this Bitcoin rally.
Short Squeeze — The Rally’s Main Engine
Short squeezes have a critical role in such bullish predictions. For the uninitiated, this market phenomenon occurs when traders borrowing an asset to sell it at a lower price—aiming to gain from the price difference—find themselves compelled to buy back the borrowed assets. This is a response to the market momentum turning against them, causing further price rallies.
Currently, Inmortal observes the market at a crucial point. “Price at support. No momentum. Both sides trying to position themselves here for the next big move,” he comments, drawing attention to the potential for a squeeze which would drastically increase Bitcoin’s liquidity up to the monthly open.
A Potential Dip Before the Surge
While Inmortal’s predictions point toward a significant BTC rally, he does not ignore the possibility of a sizeable correction beforehand. According to his analysis, Bitcoin might see a corrective movement pushing its value down to around $22,000 before any upward surge takes place.
Understanding the Market Indicators
Inmortal’s forecast aligns with various indicators. Bitcoin’s price fractal hints at an impending breakout, although the recent price increase on May 22 met with selling pressures, resulting in a 3% drop. The Relative Strength Index (RSI) also displayed a rejection after touching the mean level.
The Awesome Oscillator (AO) is currently retesting the midpoint. A breakthrough of the $26,555 support level could lead to a slide down to $25,175, Bitcoin’s immediate foothold. In the worst-case scenario, BTC could drop as far as the $23,052 barrier, signifying losses of 6% and 14% respectively from the current $26,761 price level.
However, this pessimistic outlook could be invalidated if BTC decisively turns the $28,051 hurdle into a support level, potentially propelling it up to the $30,287 mark.
At the time of writing this article, Bitcoin was trading at $26,713.