A closely followed crypto analyst is predicting a sudden short squeeze for top Ethereum (ETH) rival Cardano (ADA).
The pseudonymous analyst Capo, known for calling the 2022 crypto market collapse, says that a sharp relief rally awaits many crypto assets.
According to the crypto strategist, the rally will likely be fueled by traders who are betting on the crypto markets to correct in a straight line.
“Late shorts about to get very rekt.”
A short squeeze happens when traders who borrow units of an asset at a certain price in hopes of selling lower to pocket the difference (short) are forced to buy back as the trade moves against their bias.
Amid the short squeeze, Capo predicts a 20% rally for Cardano from its current price of $0.43 to $0.52.
Capo has a similar outlook on leading smart contract platform Ethereum. According to the analyst, the second crypto asset by market cap is looking at a 23% rally to the $1,800 level.
“ETH.
Short squeeze to $1,800 is still likely. Then new lows.”
At time of writing, Ethereum is valued at $1,453, down over 2% on the day.
Looking at Bitcoin, the popular analyst says with BTC already hitting the $20,000 level, he’s next looking at a relief rally to $23,000 before another implosion to the $16,000 range.
Capo says too many traders are confident on BTC breaking through $19,000 for price to continue in a sustained downtrend. He says an unexpected squeeze will punish short sellers late to the game.
“Much more people expecting $19,000 than those expecting $23,000. Funding says it all. Also, there’s a lot of juicy liquidity above $21,000. Squeeze those shorts.”
At time of writing, Bitcoin is trading at $19,847, flat on the day.
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Source: https://dailyhodl.com/2022/08/29/unexpected-short-squeeze-coming-for-cardano-ada-says-analyst-who-called-2022-crypto-correction/