Related Topics
Currencies , Investing , Trading
     

Bitcoin Jumps 9%: Is This Executive Order the Reason?

Here’s what our “wave model” suggested for Bitcoin before the rally

by Bob Stokes
Updated: March 10, 2022

Bitcoin and other cryptocurrencies surged higher on March 9.

CNBC provided this explanation (March 9):

Bitcoin and other cryptocurrencies were higher on [March 9] after President Joe Biden announced his highly anticipated executive order on digital assets that appeared to take a supportive stance toward the industry.

The basic message of the executive order focuses on development of the crypto market as opposed to unrealistic regulations.

Around midday (March 9), Bitcoin was trading 9.5% higher at just north of $42,200. Litecoin was trading around 9% higher and Ethereum was posting a 7% advance.

It's true that often -- although, far from "always" -- financial markets tend to have brief emotional responses to news, and cryptocurrencies are highly emotional markets in the first place. However, after temporary spikes (whether up or down), markets tend to return to their established trends.

Those trends are ascertained by looking at a financial market's Elliott wave structure, which reflects the repetitive patterns of investor psychology.

In the case of Bitcoin, Elliott Wave International crypto analyst Tony Carrion said this in the March Global Market Perspective, which published on March 4:

Focusing our attention on Bitcoin, our Intermediate wave model is bullish.

The point is: Bitcoin's Elliott wave structure was already bullish, even before that executive order.

Keep in mind, that just one day before the March Global Market Perspective published, Bitcoin's price rise was not a given.

As a March 3 Marketwatch headline said:

Most big cryptocurrencies post drops

Also on March 3, the Crypto Fear and Greed index showed a reading of 39, which indicated fear. In other words, many crypto observers were bearish. By March 8, that index slid to 21, indicating extreme fear.

Even so, Bitcoin's price action was strongly positive on March 9.

As Elliott Wave International has noted many times, when sentiment reaches an extreme, prices often move in the opposite direction from what the majority expect.

Having said that, Bitcoin has been in a bullish pattern for quite some time and another Elliott Wave International observation is that when the government jumps aboard a financial trend, they usually do so late in the game.

As you might imagine, no analytical method can provide certainty about a market's future price path. However, the Elliott wave model has proven itself time and again.

Get the details of our Elliott wave forecast for Bitcoin and other cryptocurrencies by following the link below.

Get the Bottom Line for U.S., Asian-Pacific and European Financial Markets -- Fast

You've heard people say, "Just give me the bottom line."

Our Global Market Perspective does just that with each monthly issue -- and it delivers in-depth answers to the question why.

"Why" includes Elliott wave analysis, investor psychology and applicable time-tested indicators which our deep-bench of global analysts use.

Embrace opportunities and avoid risks as you prepare for key turns in global stock markets, cryptocurrencies, forex, metals, rates, crude oil and much more.

You can find the in-depth analysis you need in our new March Global Market Perspective by following the link below.

Global Market Perspective

$77

Gives you clear and actionable analysis and forecasts for the world’s major financial markets.

Get insights for the U.S., European and Asian-Pacific main stock indexes, precious metals, forex pairs, cryptos (including Bitcoin), global interest rates, energy markets, cultural trends and more.

Netflix: Way More Room to Drop

The stock price of Netflix is down a lot and many investors believe the worst of the punishment is over. Yet, when you look at this chart of NFLX's price history, you may reach an independent conclusion.

Gold Was Primed to Rally. Then, Things Turned on a Dime (Well… 3,000 dimes to be exact!)

In early March, gold prices seemed primed to reclaim record highs with a barge of bullish factors floating in its "fundamental" harbor: Looming recession, rate hikes and the ongoing Ukraine war. But instead, that bullish barge sank right alongside a triple-digit decline in price. It's time for an intervention!

China Real Estate Leads Down: Does the U.S. Follow?

We began to cover China's coming real estate debacle as early as July 2017: Now see the chart & forecast, and if U.S. real estate may follow.