Ethereum (ETH) Short Squeeze to Fuel Rally, Predicts Analyst
In a recent blog post, popular crypto analyst Justin Bennett believes that Ethereum (ETH) could be headed for a rally that would liquidate traders who are bearish on the smart contract platform.
Bennett says that the S&P 500’s rally on Friday could be an indication of how the crypto markets will perform in the short term.
The analyst notes that crypto markets tend to follow the stock market, but there is a lag between the two. He believes Ethereum will break out and take out resistance at $1,840 if crypto takes cues from equities.
He adds that an ETH breakout could trigger a short squeeze, with a “significant cluster” of short liquidations up to the $2,000 price level for ETH.
Short squeeze and additional rallies
A short squeeze happens when many traders who shorted an asset cut their losses in response to an unexpected price bump, triggering additional gains.
Bennett suggests that ETH may target the $2,030 high from August 2022 as cryptocurrencies often aim for these areas.
The clock is ticking for crypto and Ethereum, however. Bennett believes the short squeeze must occur within the next few days, or the rally may not happen. He explains that the proximity of the short liquidations up to $2,000 may influence ETH in the short term. Still, he hopes crypto plays “catch up” to equities soon to materialize the rally.
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Conclusion
In conclusion, Justin Bennett predicts that Ethereum is headed for a rally that will liquidate bearish traders. He believes crypto tends to follow the stock market, and an Ethereum breakout could trigger a short squeeze. However, the ETH short squeeze must happen in the coming days, or the rally may not happen.
Andrey Kunev
Reporter at CoinsPress
Andrey Kunev is a knowledgeable cryptocurrency content creator passionate about the crypto market. With extensive experience in market analysis and investment reporting, Andrey is a valuable asset to the CoinsPress team. As a frequent contributor, he offers insightful and comprehensive coverage of market trends, price fluctuations, and new advancements in cryptocurrency. Whether you're a seasoned investor or just getting started, Andrey's clear and concise writing offers a comprehensive look at the current state of the crypto market and its prospects. Stay up-to-date with CoinsPress's expert analysis and commentary on all things cryptocurrency.
