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Raoul Pal, an investment analyst, indicated that traders should likely buy the Bitcoin dip as its price falls to two-month lows.
Raoul Pal needs Bitcoin owners to mobilise their trades against Elon Musk.
The macro market strategist urged traders to either accumulate or retain their Bitcoin (BTC) assets only as the flagship cryptocurrency saw massive losses over the weekend and at the start of this week.
In retrospect, bulls were put under strain when Elon Musk began shaking up the cryptocurrency sector. On May 12, the billionaire entrepreneur rescinded Tesla’s decision to allow Bitcoin payments for its electric cars, citing environmental concerns associated with the Bitcoin mining industry.
Nonetheless, he said that Tesla will continue to carry more than a billion dollars in Bitcoin on its balance sheet. In February, the firm disclosed the aforementioned crypto investment in a statement with the US Securities and Exchange Commission.
But over the weekend, Musk hinted at another U-turn. He engaged with an alleged cryptocurrency scammer on Twitter when the latter discussed the prospect of Tesla dumping its entire $1.5 billion Bitcoin stash on the market. Musk responded with an “indeed,” prompting traders to believe that he would indeed sell all of Tesla’s Bitcoin holdings.
Musk later clarified that Tesla has not sold its Bitcoin.
But the damage has already been done. Musk’s words sparked a Twitter spat with the Bitcoin group, causing influential businessman and crypto influencer Anthony “Pomp” Pompliano to label the Tesla CEO a “emotional billionaire.”
We were anticipating nation states and central banks, but instead got an emotional billionaire with a Twitter account.
— Pomp 🌪 (@APompliano) May 16, 2021
On the other hand, Pal suggested Bitcoin traders ignore the “weekend FUD” and focus on the cryptocurrency’s strong technical setup that indicates a bullish breakout, stating:
“After the weekend FUD fest and shit fighting, let’s get back to the important stuff. BTFD. BTC is forming a wedge most likely…perfectly normal correction and healthy. […] So, if you have dry powder, add. If you don’t. HODL.”
Anatomy of Pal’s Bitcoin tweet
“BTFD” is an acronym for “buy the fucking dip” — saying that traders should accumulate more assets as their prices go down. Meanwhile, Pal appeared very bullish on the latest Bitcoin correction after spotting a falling wedge pattern.
Bullish reversal trends are falling wedges. They occur when price falls within a range described by two downward sloping trendlines, as the reaction highs and reaction lows that form on them converge.
It usually results in the market breaking over the upper trendline by the length of the largest wedge. Pal’s bullish stance on Bitcoin is focused on technical theory.
A TradingView mirrored picture of Pal’s BTC trade setup reveals that the BTC/USD exchange rate could increase by nearly $14,000 on the next upside breakout jump.
Meanwhile, fundamentals such as network hash rate and other metrics in the Bitcoin industry remain bullish. However, some macroeconomic factors, especially a weakening dollar, may provide a boost to Bitcoin.
Furthermore, on May 19, the United States Federal Reserve will announce the minutes of its April meeting, which are likely to show that the central bank will hold interest rates at zero when buying government bonds and mortgage-backed securities at a rate of $120 billion per month — at least until 2023.
“We expect the minutes … to reiterate that policymakers consider the pick up in inflation to be transitory,” commented Kim Mundy, a currency strategist at the Commonwealth Bank of Australia in Sydney. Mundy also told Reuters:
“The upshot is that we do not expect the (Fed) to consider tapering its asset purchases soon. The dollar is expected to resume its downtrend this week after last week’s CPI-inspired boost.”