Famous crypto analyst Michaël van de Poppe warns of a possible sharp decline in the price of bitcoin, known as a Flash Crash, followed by a rapid recovery. The expert notes that there are signs of overheating in the market:
"Currently, classic signs of overheating have appeared in the crypto market - the volume of margin positions and overall asset volatility are increasing. History shows that during such periods, corrections become more likely and painful."
Possible consequences of Flash Crash
A sharp drop in the price of bitcoin by at least 10% could trigger a price decline in altcoins by 20-40%.
The largest public holder of bitcoins, MicroStrategy, may face serious losses in a bear market.
High volatility increases the risk of panic selling and exacerbates correction.
Forecasts and recommendations
Michaël van de Poppe emphasizes the importance of preparing for a possible correction to avoid panic when the asset's value decreases. Despite the pessimistic scenario, the analyst believes in bitcoin's potential: in his opinion, by the end of November, the cryptocurrency could reach $100,000 due to a sustained upward trend.
The market remains unstable, and traders are advised to pay attention to risk management to be prepared for sharp price movements.
Source: bits.media