- Bitcoin’s price action of late has done little to offer investors tangible information on the next move.
- Analysts largely note that the outlook for the cryptocurrency is clouded by the turmoil in the stock market, which may linger until after the election.
- Many traders believe the remainder of Q4 will be a bullish month for BTC, as this may be the time when it can decouple from the stock market and gain independent momentum.
- An analyst explained that he believes the drop is imminent in the coming quarter, noting that the whales will have to cash in some of their crypto to cover taxes, which could trigger a sell-off.
Bitcoin and the broader crypto market have lacked momentum over the past few days and weeks.
Much of this is due to the turmoil in the stock market with bulls and bears unable to trigger short-term trends as the stock market consolidates.
This sideways trading model may not last too long. One analyst noted that BTC could see a whale-induced sell-off selling their crypto to cover taxes.
He notes that this sentiment is reflected in turning to options market makers.
Bitcoin lacks momentum as stock market continues to consolidate
The stock market hasn’t been able to form a clear trend of late as investors largely awaited more information on a Phase 2 stimulus package that has yet to be approved by Congress and the White House. .
As the election draws closer as well, investors are potentially awaiting its results before opening new positions.
This caused Bitcoin to see similar lackluster price action. The bulls and bears are largely at an impasse and have not been able to trigger a short term trend.
At the time of writing this article, Bitcoin is trading lightly at its current price of $ 11,400. This is about the price it traded for over the past week.
Analyst: BTC is expected to experience a tax sale later in Q4
An analyst offered a bearish outlook on Bitcoin and the crypto market in the fourth quarter, noting that he expects him to see a whale-induced sale taking money to cover taxes.
“It’s hard for me to imagine a Q4 mega pump. All whales sell to prepare for the tax. Unless you tell me the majority of cryptocurrencies are in tax havens such as SG and HK. Feelings shared between the options market makers who evaluate the IV at 30% + each month, ”he explains.
Image Courtesy of Theta Seek.
If the options market makers turn out to be correct, the next few months could be turbulent for Bitcoin.
Featured image from Unsplash. Charts from TradingView.