A widely followed crypto analyst is looking forward to what a new month might mean for the top two crypto assets by market cap.
In a new Daily Price Action blog post, crypto trader Justin Bennett says that yesterday’s sell-off in the Bitcoin (BTC) markets might just be due to institutional traders balancing their books.
“As large institutions close their books, we often see markets become erratic and indecisive in the final 24-48 hours of the month.
So how Bitcoin trades in the first week of June will be telling.
But if bulls can’t reclaim $27,500-$27,650 quickly, we’re looking at another selloff toward $26,500, potentially lower.
Regardless, remember to trade BTC level to level and respect support as support and resistance as resistance.
Given how sideways the crypto market has been since March, it isn’t the time to swing for the fence and target the next big move.
A better approach is to trade level by level and take what the market gives you.”
Bitcoin is worth $26,887 at time of writing, just below the area Bennett says BTC bulls must reclaim.
Looking at Ethereum (ETH), Bennett tells his 112,500 Twitter followers that ETH is not ready for big, “home run” trades.
“This is why I’ve been saying to take what the market gives you in these conditions.
Not the environment for home run trades.
ETH right off of the support and resistance I outlined in Tuesday’s blog post.”
Diving deeper into the aforementioned blog post, Bennett said in a Daily Price Action post on Tuesday that Ethereum has “liquidation clusters” at both $1,960 and $1,830.
“Liquidation clusters like this often serve as magnets for price.
That alone could trigger another rally from Ethereum, making the recent consolidation a continuation pattern.
To be fair, there’s also a decent block of ETH long liquidations at $1,830.
So really this could go either way, especially as we enter the final 24 hours of the month.
But the determining factor in whether we see $1,960 or $1,835 first will be the $1,887 level.
As long as ETH holds above that on a 4-hour closing basis, the next resistance and liquidation pool is $1,960.
Conversely, a sustained break on the 4-hour time frame below $1,887 would confirm this consolidation as a deviation and open up $1,835.
Either way, expect erratic price action from the crypto market as we enter the final 24 hours of May.”
ETH is trading for $1,863 at time of writing.
Featured Image: Shutterstock/TadashiArt
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