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Bitcoin: Anticipating the Next Big Move

Elliott waves versus news and events in the world of crypto

by Bob Stokes
Updated: February 02, 2023

After a tumultuous year in the world of crypto, many observers might be surprised that Bitcoin not only held its ground after hitting a low near $16,000 a couple of months ago, it's seen appreciable price gains since then.

Of course, the tumult to which I refer is the collapse of some crypto-related businesses, including exchanges:

  • Genesis, a Crypto Lending Firm, Files for Bankruptcy (The New York Times, Jan. 20)
  • Bank Run at Crypto Lender Silvergate Capital Wipes Out 7 Years of Profits (Barron's, Jan. 5)
  • FTX Goes Bankrupt in Stunning Reversal for Crypto Exchange (Time, Nov. 11)
  • US Regulators Probing Bankrupt Crypto Hedge Fund Three Arrows Capital (Bloomberg, Oct. 17)
  • Crypto broker Voyager Digital files for bankruptcy as industry falters (Washington Post. July 6)

Nearly everyone knows that the most publicized crypto-related collapse was that of FTX.

Dips in the prices of cryptocurrencies, such as Bitcoin, were attributed to FTX's implosion around the time it occurred.

But, after a few weeks, a financial website has this headline (Markets Insider, Dec. 14):

Bitcoin has surprisingly held up since the FTX collapse, but the fall to $10,000 will take more time, strategist says [emphasis added]

Financial markets have a way of confounding people, and this is simply an example in a long list of occurrences down through history. Observers want to link news and events to the behavior of markets, but it generally does not work that way. Oh, there might be temporary emotional spikes (up or down) in a market after a major event, but the price pattern generally picks up where it left off shortly after the spike.

Well, here's some news for you: Elliott Wave International was not "surprised."

Indeed, our December 2022 Global Market Perspective anticipated a move higher in Bitcoin that we've seen over the past couple of months. Here's a quote:

Bullish reversal underway. (Published Dec. 2, 2022, Global Market Perspective)

Remember, this forecast was made in real time, when Bitcoin had been in a downtrend for the entirety of 2022 and when many headlines were saying that the collapse of FTX meant further decline.

But for Elliott wave analysis to be useful, a practitioner must stick with what the Elliott wave price pattern suggests, no matter what the headlines are saying.

On the date that our December Global Market Perspective published (Dec. 2), Bitcoin closed at $17,088,66. As I'm writing this, the cryptocurrency is trading near $23,000, a 34% advance.

Learn what our February Global Market Perspective, which publishes Feb. 3, expects next for Bitcoin by following the link below.

Global Stock Markets Never Need a "Reason" to Make Big and Sudden Moves

The history is clear: Global stock markets have indeed made big price moves on days when there was no big news.

What's more, trading days often move contrary to the headlines: In other words, stock prices rise after bad news, and fall when news is good.

Ever wonder why?

Put simply: News and events do not drive global stock market trends. Yes, the market might have a brief emotional reaction, but the main trend in all major world indexes simply picks up where it left off.

You see, investor psychology is the real driver behind stock market trends -- Elliott waves directly reflect this psychology.

Learn what our experienced global Elliott wave analysts are saying about the next big moves in stock markets around the world -- plus, get analysis of cryptocurrencies (including Bitcoin), crude oil, natural gas, metals, forex, bonds and much more.

Follow the link below to get the financial insights that you need.

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