An analyst who correctly called Bitcoin’s (BTC) 2018 bear market bottom warns that a weak stock market could ignite another sell-off event in crypto.
Pseudonymous analyst Bluntz tells his 224,600 followers on the social media platform X that the S&P 500 appears to be struggling at the 0.618 Fibonacci level after printing a three-wave bounce.
Bluntz makes predictions based on his interpretation of the Elliott Wave theory, a technical analysis approach that attempts to predict future price action by following the psychology of market participants, which tends to manifest in waves. According to the theory, a bearish asset tends to witness an ABC bounce before resuming its downtrend.
The analyst warns that now is not the time to be bullish on either the stock market or crypto.
“Equities have had a nice bounce from the lows BUT they seem to be stalling at the 0.618 [Fibonacci level] and so far has only been a bounce in three waves so definitely looking a bit sketchy right now.
If they begin to turn south, it would probably be enough to send crypto lower also.
Stay safe, not the time to be long in my humble opinion. No position is also a position.”
At time of writing, the S&P 500 is sitting at 4,496 points, below the 0.618 Fibonacci level at 4,520 points.
Bluntz’s latest analysis appears to be aligned with his recent call that Bitcoin is likely due for more corrective moves before carving out a local bottom. The analyst previously said that BTC will likely fall to the $23,000 price area before basing out and starting a fresh uptrend.
At time of writing, BTC is worth $25,814.
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