Investment idea: sell bitcoin and Ethereum as part of the final correction wave

The decline in prices of recent days in the cryptocurrency market is fundamentally justified. The tightening of monetary policy by world central banks, the decline of classical stock markets and internal problems in the industry (the collapse of the LUNA project and the UST stablecoin) led to the fact that investors significantly reduced the volume of purchases in cryptoassets. Also, the volume of the bitcoin plant on crypto exchanges by miners has grown significantly, which has not been observed in such volumes for several months. This puts additional pressure on BTC, ETH and other digital assets.

Despite the fact that, in general, the situation on the crypto market is not a crisis, and the current decline in capitalization occurs only as part of a correction from the trend that began in March 2020, I believe that we are in for another final wave of price declines for the most capitalized crypto assets. It is also worth noting that the fall in cryptocurrency prices is not actively redeemed at the moment (there is no triggering of “stops” of participants, which is always visible from the price behavior on the chart).

In this regard, a further potential drop in BTC and ETH is possible, and it should be worked out through the sale of futures.

The essence of the idea: selling futures on BTC/USDT and ETH/USDT with targets of $20,000 and $1,250, respectively. Stop-loss levels can be placed above $33.5K and $2.25K.

The main risks of selling assets in the current environment are proximity to potential areas of increased demand, where purchases will exceed sales. As a result, the lower the price goes, the higher the probability of sharp bounces up, and close stop-loss orders may work, even though further declines are possible. In this regard, it will be possible to re-enter the position.

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